WASHINGTON – The U.S. private equity industry has amassed $353 billion of dry powder as of December 2017, according to the American Investment Council’s (AIC) 2018 Q2 Private Equity Trends Report, released today. This figure marks a 44 percent increase from the $245 billion of US-based callable capital reserves in December 2016.
“Dry powder levels continue to hit historic levels and reflect the robust and fast-paced fundraising environment over the last few years,” said Bronwyn Bailey, AIC Vice President of Research and Investor Relations.
Despite record levels of dry powder, Q2-2018 saw total private equity investment drop to $41 billion, a 49 percent decline from this point last year. Prior to 2018, U.S. private equity investment had steadily increased since 2009. In addition, fundraising volumes fell to $19 billion, equity contributions remained level, and exit volumes decreased to $51 billion.
“Investment volume in private equity slowed this quarter, a reversal of the upward trend we saw in almost every successive year over the last decade,” said Bailey. “With record levels of dry powder, fund managers are well-positioned to invest more capital in growing businesses and industries across the country.”
Below are key findings from the report. Read the full report here.
- U.S. PE Investment Volume Falls: U.S. private equity investment volume fell to $41 billion in Q2-2018 from $80 billion in Q2-2017.
- Equity Contributions Remain Level: Total equity financing for leveraged buyouts remained at 41.1 percent, the same level it was at the end of Q2-2017.
- U.S. Fundraising Falls: U.S. private equity fundraising volume fell to $19 billion, a 65 percent decrease from $55 billion in Q2-2017.
- Dry Powder Grows: Callable capital reserves of global buyout funds rose to $353 billion by December 2017, a 44 percent increase from $245 billion in December 2016.
- Exit Volumes Decrease: U.S. private equity exit volume fell to $51 billion, a 54 percent decrease from $110 billion in Q2-2017.