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New Investment Report Highlights Private Equity’s Key Economic Sectors

Business Products & Services (B2B) And IT Companies Received Nearly Half Of PE Investment In 2016

WASHINGTON – Information Technology (IT) and Business Products & Services (B2B) accounted for $322 billion of the total $646 billion in U.S. private equity investment last year, according to the American Investment Council (AIC) 2016 Q4 Industry Investment Report, released today.

“This report shows private equity’s significant role in valuable innovation sectors of our economy,” said AIC President and CEO Mike Sommers. “From information technology to products and services, private equity investments fuel growth and job creation across industries.”

IT companies experienced the largest annual increase in investment, jumping from $75 billion in 2015 to $165 billion last year. The number of IT deals, however, remained roughly in line with deals seen in previous years. By comparison, while B2B made up a large share of total private equity investment, it saw a dip in both investment levels and the number of deals relative to 2015.

Other large sectors for private equity investment included Consumer Products & Services (B2C), Financial Services, and Healthcare. Deal activity and investments in these sectors remained high by historical standards, despite being down in 2016 compared to the previous year.

On a quarterly basis, investment levels in B2B, B2C, IT, Healthcare, and Energy fell or were unchanged in Q4 2016 compared to the previous quarter. Conversely, Materials & Resources saw a spike in investment levels in Q4 2016 compared to Q3, as did Financial Services.

“Despite economic and political uncertainty, these measures confirm private equity is relatively consistent in its continued investment in companies across all sectors and sizes,” said AIC Vice President of Research and Investor Relations Bronwyn Bailey. “We expect to see more capital deployed this year and competition by PE funds for successful deals, which will ultimately benefit economic growth.”

Read the full report 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.