Private Equity Outlook

Alasdair Warren, Global Head of the Financial Sponsors Group at Goldman Sachs, explains his view on the Private Equity industry. It is robust but facing challenges.

Here is a quick summary of the video (below):

Capital is not a constraint:

  • The world is flush with capital, both equity and debt
  • Over the last 4 years, PE firms have raised more than USD280bn
  • The debt markets are extremely deep and liquid (possibility of leverage is significant)

Key focus for PE firms:

  • Strong cash flows
  • Robust asset backing
  • Highly leverageable
  • Multiple growth opportunities

Deploying available capital is difficult:

  • Valuation are high
  • Relatively limit supply of available assets
  • Increasing competition