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NZVIF Releases Private Equity Research Report; Cites Impressive Returns

22 November 12

The New Zealand Investment Venture Fund Limited has released a private equity report that states that private equity investments into unlisted New Zealand companies have on average doubled over the investment holding period.

The research analysed returns generated from investments into companies made by NZ and Australian private equity funds over 18 years between 1994 and 2012.

Some insightful statistics report that:

  • Thirteen funds invested $1.36 billion into 92 companies which returned $2.85 billion upon realisation.
  • The average deal size of $14.2 million, with the largest deal being over $200m of equity investment and the smallest being around $1m.         
  • For every dollar invested in New Zealand companies, $2.10 was returned on those investments. The $1.36 billion invested between 1994 and 2012 earned $2.85b, before management fees and costs are accounted for.
  • The annual rate of return (IRR) on these private equity investments in New Zealand over the period was 33.7 percent.
  • 39 percent of investments earned more than double what was invested, and 7 percent earned over five times what was invested.
  • Returns on investments were positive across the full period, although, as expected, were highest during the period from 1998 through to 2006.
  • The New Zealand private equity investment performance compares similarly to that of the Australian mid-market.

You can read the full report here.