PE firms raised $50 bn in Jan-Mar quarter

Private equity firms raised a whopping $50 billion globally during January-March, which is a jump of 72% from the year-ago period, says a report.

According to a report by international research firm Preqin, 623 private equity funds worldwide raised an aggregate $49.9 billion in the January-March quarter of the 2011 calender year, 72% higher than year-ago period when 470 deals valued at $29 billion were completed.

On quarter-on-quarter basis, the number and value of deals have seen a decline. Number of deals fell by 8% and aggregate transaction value plunged by 26% in the October-December quarter of 2010.

"This was not due to a general slow down in global deal activity – Q1 2011 is only surpassed by Q4 2010 in terms of deal volume since the onset of the financial crisis – but more because of the lack of large and mega buyout activity," Preqin Private Equity Deals (Manager) Manuel Carvalho said.

With respect to funds focussed on Asia and the rest of the world, excluding the US and Europe, such funds garnered a total of $10.3 billion in first quarter of 2011 as against $8.9 billion raised in the previous quarter.

Besides, North America and Europe witnessed a drop in aggregate deal value.

North American deals were worth $22.6 billion, 41% less than during Q4 2010 ($38.3 billion). This is due largely to a lack of large and mega buyout activity.

European deal value dropped slightly from $19.7 billion in Q4 2010 to $17 billion in Q1 2011.

In terms of sector, PE firms have garnered most of the interest from the industrial sector, which is almost a fifth of the aggregate total deal value.