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Is This The Top? Private Equity "Exits" Surge To Record Highs
After a slow first quarter of 2015, the private equity industry experienced a revitalization in Q2-2015. Investment dipped by less than 1 percent to $112 billion, holding strong at the second highest Q2 level since 2007, fundraising fell to $30 billion. . Meanwhile, as ValueWalk details, exit volume exploded last quarter to $125 billion - the highest level on record - raising the question: "if everything is so awesome, why the smartest people in the room selling to the public at the heaviest pace ever?"
Some key metrics of the private equity industry in the second quarter of 2015 are:
U.S. Private Equity Investment Volume Decreases
Quarterly U.S. private equity investment deal volume fell slightly from $113 billion in Q1-2015 to $112 billion in Q2-2015.
Current Level - $112 B
Quarterly Change % - -1%
Equity Contributions Hold Steady
Total equity financing for U.S. leveraged buyouts remained at 42% in Q2-2015.
Current Level - 42%
Quarterly Change % - 0%
U.S. Fundraising Levels Fall
Quarterly U.S. private equity fundraising volume declined from $38 billion in Q1-2015 to $30 billion in Q2-2015.
Current Level - $30 B
Quarterly Change % - -21%
Dry Powder Increases
Callable capital reserves (“dry powder”) of global buyout funds increased from $431 billion in December 2014 to $467 billion as of the end of June 2015.
Current Level - $467 B
Quarterly Change % - +8%
Exit Volume Jumps
U.S. private equity exit volume grew from $70 billion in Q1-2015 to $125 billion in Q2-2015.
Current Level - $125 B
Quarterly Change % - +80%
Fig 1 The four-quarter average for exits took a sharp turn upwards in 2015-Q2, while the average for investments and fundraising decreased.
Fig 2 U.S. private equity investment volume contracted by 1% from the previous quarter.
Fig 3 The proportion of equity financing for U.S. leveraged buyouts remained at 42%.
Fig 4 Capital raised by U.S. private equity funds declined from the previous quarter to $30 billion.
Fig 5 Global callable capital reserves (“dry powder”) of buyout funds increased to $467 billion as of June 2015.
Fig 6 U.S. private equity exit volume grew from previous quarter levels to $125 billion.
So - to summarize - funding levels are falling, dry powder is rising, and exit volume are at record highs... Still want to buy stocks with both hands and feet!!!!
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peak fiat (drops mic and exits stage left)
USD is a renewable resource like the sun silly.
Fly on the wall reports conversation:
Private Equity-- "Hey could you hold this bag?"
Pension Funds- "Sure, thanks man! Hey do you want your other bag back.
No? OK I'll just hold 'em both for ya! Toodles!"
Rats fleeing the sinking ship!!
saving money to buy the next power broker...Hillary, Trump, Biden, Jeb...who will get thier money
who needs to invest...just hyper trade stock!
The top isn't in until I say it's in. Remember I know where you work, so stop asking pesky questions.
Hugs and kisses,
Grandma Yellen
P.S. Would you like a cookie dear?
It's all about liquidity!
Its a very liquid market!
Like quicksand is a liquid beach.
You can't make money in this environment unless you are a hedge funder or an oligarch. I'm just happy I have a good secure job and I plan on keeping it until I die! Let the kids fight over the scraps that I leave behind...
The top is in unless the Tribe does QE4 (which they will).
Gotta take it way down first, scoop up fire sale assets, then it's time for the next pump and dump for the chumps.
A slow motion crash allows for more fees.
10% slide with a trajectory of a .45 ACP round at 100 yards, will bring in the $Big $Guns.
Disappointing article. Even cursory knowledge of private equity reveals that by law they are limited to a holding period of 7 years.
http://www.zerohedge.com/news/2015-07-22/billionaire-owners-twinkie-make...
They don't hold everything for 7 yrs.
PE is too pessimistic, me thinks.
ZH too.
:-]
*NEWS ALERT*
Zero Hedge calls market top for the 47296th time, claiming "it's different this time".
It was posed as a question: "Is This The Top?" Not a statement of fact.
Well, we've been in 17-18K limboland for a year now, if this isn't the top, I don't know what is. You think we're going to 19K anytime soon? The question is when is the big correction? He who panics first panics best!
After a few bongs it looked fine to me.