News Coverage of PEGCC’s Top Ten Private Equity Trends for 2016, Powered by EY

The release last week of PEGCC’s Top 10 Private Equity Trends For 2016 garnered several news mentions, including Bloomberg, Private Wealth, and Think Advisor. The report forecasts private equity investment, regulatory implications, GP/LP relations, and portfolio company operations. The PEGCC’s forecast is based on a study conducted by EY in late 2015.

Key excerpts are below:

The Private Equity Market For 2016 “Will Be A Strong One.” “This year will be a strong one for the private equity market, according to the Private Equity Growth Capital Council (PEGCC), an advocacy and communications organization for the private equity and growth capital investment industry based in Washington, D.C. Valuations will remain high and firms will stay in the private market with few initial public offerings, predicts PEGCC. Based on a survey of 26 private equity firms with a total of $276 billion in assets under management, the council made predictions on trends for the industry for 2016.” (Karen DeMasters, “Growth Period For Private Equity Predicted,” Private Wealth, 1/29/16)

This Report Can Help Financial Advisers And Wealth Managers More Effectively Navigate The Private Equity Landscape. “‘Financial advisors and wealth managers can use our private equity trends report to more effectively engage with private equity fund managers,’ says Maloney. ‘Understanding the current high-valuation landscape and the PE industry’s divergent investment strategies can focus advisors to ask key questions. Although private equity is a long-term investment, an advisor is smart to anticipate the activity of funds,’ he adds.” (Karen DeMasters, “Growth Period For Private Equity Predicted,” Private Wealth, 1/29/16)

IPOs Will Continue To Fall “Significantly” Throughout 2016. “Private equity managers expect IPOs this year to fall ‘significantly,’ according to a survey of 26 firms released this week by Ernst & Young and the Private Equity Growth Capital Council. One-fifth of the buyout firms with at least $20 billion under management, and 5 percent of smaller firms, see a public offering as the most attractive exit route in 2016, as opposed to selling a portfolio business to a company or another private equity firm.” (Alex Barinka, “U.S. IPO Market On Track For Slowest Month Since Recession,” Bloomberg, 1/25/16)

Private Equity Strategies Will Diverge Based On Firm AUM. “Seventy-three percent of larger firms said they were considering more involvement in credit/distressed investments in 2016, compared with 33% of smaller firms. Larger firms are also planning significantly more involvement in real estate (64%), hedge funds (27%), fund to funds (18%) or retail and high-net-worth focused funds (18%). In contrast, 48% of smaller firms had no plan to increase their involvement in any of those investment strategies. Fifty-nine percent of smaller firms reported an industry specialization — including energy, health care, business services, software and technology, automotive and operating talent — compared with 30% of their larger counterparts.” (Michael Fischer, “Top 10 Private Equity Trends in 2016,” Think Advisor, 1/26/16)

Co-Investments Will Increase In 2016. “A majority of all respondents expected limited partner participation in co-investment opportunities to increase over the next 12 months. No respondents of any size expected LP participation to decrease.” (Michael Fischer, “Top 10 Private Equity Trends in 2016,” Think Advisor, 1/26/16)