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A renewed appetite for private equity investors - About our private equity exit study - EY - United States

A renewed appetite for private equity investors (North American study)

About our private equity exit study

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The study was built upon public data and private and detailed interviews with former PE owners of the exited businesses.

To avoid performance bias, and to ensure a focus on the largest businesses owned by PE, exits were screened to capture those that had an entry enterprise value of US$150m and above. This criterion was also applied to our estimate of the current size of PE portfolios.

We assessed business performance for the duration of PE ownership, based on key performance measures, including changes in EV, profit (defined throughout the report as earnings before interest, depreciation, tax and amortization, or EBITDA), employment, productivity and valuation multiples.

To measure aggregate economic impact more effectively, we used weighted averages. The study was built upon public data and private, detailed interviews with former PE owners of the exited businesses. In order to benchmark the performance of PE-owned businesses against comparable public companies, we have compiled data on public companies by sector over the same time period as the PE exits in our sample.

The data was then aggregated to compare PE performance with that of public companies. The ability to incorporate data obtained from top PE investors is an important feature of the study. Another is the scope and depth of the research, with a sample including 441 North American exits. The EY study is a leading piece of research, and is recognized by many commentators as an authoritative work in the field.



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