{"id":89928,"date":"2024-03-12T00:00:00","date_gmt":"2024-03-12T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/uae\/private-equity-grapples-with-usd-3-tn-worth-of-unsold-companies\/"},"modified":"2024-03-12T00:00:00","modified_gmt":"2024-03-12T00:00:00","slug":"private-equity-grapples-with-usd-3-tn-worth-of-unsold-companies","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/uae\/2024\/03\/12\/private-equity-grapples-with-usd-3-tn-worth-of-unsold-companies\/","title":{"rendered":"Private equity grapples with USD 3 tn worth of unsold companies"},"content":{"rendered":"

The private equity industry is facing a severe liquidity crunch<\/strong>, with firms globally sitting on a whopping 28k unsold companies valued at USD 3.2 tn, according to consultancy Bain & Co's latest annual private equity report (pdf)<\/a>. Nearly half of assets have been held for four years or more, which the report says is the largest proportion since 2012.<\/p>\n

The good and the bad: <\/strong>The staggering pile of assets highlights the breakneck growth of the buyout industry over the past decade, but also points to the immense challenges posed by soaring interest rates in recent years that have made exiting investments far more difficult.<\/p>\n

Dealmaking came to a crashing halt last year as debt financing dried up:<\/strong> The total value of companies PE groups sold via private sales or public listings dipped 44% y-o-y in 2023 to USD 345 bn \u2014 the lowest level in a decade. The slump was even worse for portfolio companies sold to rival buyout firms, with sales tumbling 47% to USD 62 bn amid widespread pricing disagreements across the industry.<\/p>\n

ALSO WORTH NOTING-<\/strong><\/p>\n