Buyouts? No, Thanks: PE Firms Focus on New Strategies
October 22, 2013
The historically buyout-heavy private equity industry is making fewer buyouts these days.
According to PitchBook's recent Private Equity Breakdown, buyout deals have gone down as a percentage of all PE transactions in recent years. In 2004, for example, buyouts accounted for 51% of private equity transactions, while minority growth deals accounted for 17% of private equity deals that year. So far this year, buyouts have only made up 33% of all PE transactions, while minority growth investments have jumped to 25%.
Firms have been pivoting away from the traditional buyout model for years, looking for opportunities in less conventional markets like infrastructure, energy, real estate and high-yield debt. "You've seen a radical shift in what private equity has done these last few years," Blackstone president Tony James told the WSJ earlier this year. "You're forced to cast your nets a bit wider and find things where the space isn't so crowded."