PE firms show more interest in emerging markets

Buoyed by improving economic environment and higher investment flows, private equity (PE) companies are increasing their exposure to emerging markets.

According to Emerging Markets Private Equity Association, investments by PE companies in China, India and Latin America have risen to $13 billion (Rs 60,047 crore) in January-June, up 55 per cent from $8.4 billion a year ago.

“Investment conditions in emerging markets are revitalising. There are more and better quality deals in the pipeline. Emerging market fund managers are increasingly bullish in the light of stabilising markets and lower valuations,” Sarah Alexander, chief executive officer, Emerging Markets Private Equity Association, said in a release.

In the first six months, there were 402 transactions compared with 280 in the year-ago period.

The average deal size too has gone up to $51 millio from $40 million, driven by 28 transactions of over $100 million each.

In the year ago period, there were only 17 deals of over $100 million.