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Alternative Market Briefing

Global private equity assets under management climb to record high of $5tn

Thursday, April 15, 2021

Laxman Pai, Opalesque Asia:

Global private equity recovered strongly in Q1 2021 after a turbulent year. Assets under management (AUM) surpassed a record $5tn as of September 2020, bolstered by rising valuations in both private and public markets, said Preqin.

More impressive is that dry powder reached a record $1.6tn - approximately double the combined value of all buyout and venture capital deals over the past 12 months.

"Looking forward, fresh capital continues to flow quickly into the asset class in the first quarter with fundraising activity returning to pre-pandemic levels," said Q1 2021 Private Equity Quarterly Update by Preqin.

Private equity funds raised $188bn across 452 funds in Q1 2021, this is up from $163bn and 431 funds in Q1 2020, said Preqin in a report.

Despite a solid fundraising result, a record number of funds remain in the market. As of April 2021, a record 4,597 funds are seeking to raise a combined $914bn from investors.

"On the back of this, fund managers are sitting on a record $1.6tn in dry powder putting increasing pressure on deal makers to identify investment opportunities quickly as the recovery picks up," the report said.

First-quarter buyout deal activity slowed slightly coming off a robust Q4 2020. That said, in Q1 2021, 1526 transactions were completed with an aggregate value of $133bn - both notably higher than Q1 2020.

Venture capital deal values are also soaring. Aggregate venture capital deal va......................

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