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HULT Private Capital Explains the Increasing Demand for Private Equity Investments

HULT Private Capital Explains the Increasing Demand for Private Equity Investments

London – 21 September 2021 – A shift away from publicly traded companies and towards private equity as a central driver of the UK economy has been accelerated by pent-up demand and low interest rates. With an increase of 39% in closures of mid-market private equity deals alone in the first half of 2021 compared to 2020, we are currently enjoying a buyers’ market. Here HULT Private Capital examines this good news for private equity investors in greater depth.

What are the numbers?

Across the private equity market, we are seeing renewed confidence amongst investors. During the first quarter of 2021, closed private equity deals in Britain reached a five-year high compared to previous Q1s. H1 saw 785 deals completed with a total value of £73.7 billion, impressive figures last seen in 2017. This marks a 61 % growth in volume and 48 % increase in value of the transactions completed in H1 2020.

Contrasting these figures with the EU which saw just 14 % growth, it is clear that the UK holds considerable potential for investors looking to expand their holdings in the private equity market.

What is driving the expansion?

One of the key forces behind the flurry in the market is the revival of deals that were paused during the first half of 2020 as the pandemic took hold. With investors now returning to the field keen to lay down cash, the private equity market has been reinvigorated.

Compounding this, the UK’s relatively cheap equities are encouraging buyers to spend. The mass withdrawal of investors from UK equity income funds following the 2016 Brexit vote made the UK stock market appear enticingly cheap compared to the EU and US. Those now keen to invest are enjoying the appealing opportunities this presents.

Low interest rates are also pushing investors towards private equity in search of higher yields, including via buyout firms like HULT Private Capital who are offering attractive returns. Moreover, low interest rates on borrowed funds means the private equity model is more accessible than ever. This facilitates new entrants to the market as well as encouraging those eager to use leverage to generate better returns.

In short, investors are recognising the significant opportunities currently presented by the private equity market and are excited by the potential for generous returns implied by the UK’s low prices and interest rates amidst its nascent post-pandemic economic revival. No doubt investors will take advantage of this buyers’ market sooner rather than later.

About HULT Private Capital – The Investment Boutique of Choice for Sophisticated Investors 

Across the UK, UAE, Germany, Hong Kong and the wider world, HULT Private Capital and Partners is synonymous with successful investment solutions that evolve with investors’ needs in an ever-changing global market.

Renowned for our secure structured investment facilities which are designed to ensure robust capital growth, our unique approach attracts high net-worth individuals (HNWI) and sophisticated investors to our continually growing client base. Our 98 % client retention rate is testament to the impressive work we do for our customers.

HULT Private Capital connects the top advisors and experts in a broad range of investment vehicles with partner companies based around the world. Our access to exclusive top tier investment portfolios means we can help investors looking to generate exciting returns via private equity, businesses, property and more.

Contact HULT Private Capital Today

For help with any queries, suggestions or something you would like to talk through with our team, please get in touch with HULT Private Capital today and we will be glad to assist.