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Impact Investing

IPE special report May 2018


Europe continues its private equity investment

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EUROPE – Institutional investors across Europe are continuing to invest in private equity, despite the severe downturns in its market in the last couple of years, according to the latest survey from private equity research specialists, AltAssets.

The report shows that the 110 investors surveyed have placed more than €89bn to date in private equity and this figure is expected to exceed €100bn in the next five years.

However, a spokesman for AltAssets says the figures should be taken in context and are somewhat surprising, especially given that investors are increasingly concerned about the lack of benchmarks and transparency in private equity and the reward structures used by many private equity companies.

“Investors are obviously convinced that returns from their investments will improve significantly,” he says. Moreover, he points out that the percentage of portfolios given over to the asset class remains low when you consider the investors individually.

Nonetheless, the research suggests this will change too, as the number of respondents that anticipate allocating at least 3% of their portfolios to private equity in coming years has risen from 43% to 67%. “This shows that private equity, despite all its woes, is fast becoming a significant asset class in Europe,” says AltAssets’ spokesman.

The report finds that Germany tops the league geographically as best market to invest in, followed closely by Spain, Scandinavia, France and the UK.

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