Private equity is for investors with nerves of steel and deep pockets
Private equity is an asset class viewed with apprehension and suspicion. But for brave investors it has delivered returns of 18% versus the JSE’s 12.6%.That’s according to the Southern African Venture Capital and Private Equity Association (Savca).Meet private equity, which many associate with Bain Capital’s R25bn failed investment in Edcon, holding company of retail chain Edgars. Boston-based Bain recently handed Edcon over to creditors after failing to grow it, improve profits or cut costs.SA’s private-equity sector attracts billions in investments, mainly from pension and endowment funds. In 2015, fund managers raised R29bn, up from R11.8bn, and the highest on record for the industry, according to Savca. This raised total funds under management to R165.3bn by the end of the year.Here is SA’s private equity industry by numbers:• Two firms – Ethos Private Equity and Metier Private Equity — dominated deal making in 2015, between them accounting for six of the top 10 deals by enterpr...
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