Sommers Discusses Tax Reform, Infrastructure Investment, and PE’s Economic Impact
WASHINGTON– The American Investment Council (AIC) released its newest “AIC Insights” webcast today, featuring a conversation on the state of the private equity industry between AIC President and CEO Mike Sommers and former Wall Street Journal reporter Patrick O’Connor.
The latest in the AIC’s webcast series, Sommers covers private equity’s current role in the U.S. economy and its position for future impact in areas such as infrastructure.
“A lot of what private equity does too often misses the headlines,” said Sommers. “This is an industry that invested $644 billion in more than 3,700 U.S.-based companies in 2016. That investment benefits both companies’ employees and investors like pension funds.”
Key takeaways from “American Investment Council: State of the Industry”:
- Private equity continues to provide higher annualized returns, net of fees, than traditional equity markets. The AIC’s 2016 Q4 Performance Update report shows that PE outperformed the S&P 500 total returns index over the 1-, 3-, and 10-year time horizons, and also exceeded the Russell 3000 Index over a 10-year time frame, generating a 10.7 percent annualized return for investors.
- In 2016, private equity invested $644 billion in all 50 states. Texas received the most investment at almost $80 billion invested in 413 companies.
- Private capital investment in infrastructure is growing. North American Infrastructure Funds currently hold $70 billion in dry powder, and in 2016 alone aggregate capital fundraising for these funds reached $30.2 billion.
- Key tax provisions are critical to private equity’s ability to strengthen the U.S. economy. Businesses in red states and blue states across the country rely on interest deductibility to invest in future growth.
View all AIC Insights here.
About the American Investment Council
The American Investment Council (AIC) is an advocacy and resource organization established to develop and provide information about the private investment industry and its contributions to the long-term growth of the U.S. economy and retirement security of American workers. Member firms of the AIC consist of the country’s leading private equity and growth capital firms united by their successful partnerships with limited partners and American businesses. More information about the AIC can be found at www.investmentcouncil.org.