More than three quarters of all PE backed exits in 2018/19 delivered growth across the investment hold period, our drxDATA research reveals.
A survey by drxDATA of all 252 exits achieved by UK private equity backed businesses in 2018/2019 found that 78% of them delivered growth across the investment cycle.
drxDATA used a combination of three metrics, growth in EBITDA, revenue and total assets, to determine the growth of an asset over the whole period to exit.
Roughly 10% of all exits delivered a growth rate above 100%, while 10% of all exits demonstrated a significant loss. The remaining middle portion of the marketplace showed a steady, relatively non-volatile rate of growth across all three metrics measured, suggesting that growth across these businesses was broad based and sustainable.
Samuel Robberts, Head of drxDATA, said: “Our research found that the majority of PE investments are sustainable and lack volatility. These returns clearly demonstrate the value of private equity as an asset class to investors. Obviously no business investment comes without a downside risk, but our analysis of Private Equity last year suggests that the consistency of returns, not just the magnitude of the best ones, means Private Equity deserves it’s reputation as one of best asset classes around.”
drxDATA® is Drax’s proprietary data analytics platform which is used to develop unique data sets providing insights and analysis for our clients.
Drax contact: Samuel Robberts
Head of drxDATA
Tel: 0203 949 9565