Australian private equity and venture capital firms produced an average return of 22 percent IRR during 2013, according to the Australian Private Equity and Venture Capital Association using data by Cambridge Associates.
The results show that GPs outperformed public markets by over 200 basis points.
The CA Australia Index, which is a performance benchmark for the industry, showed a significant pick up in performance during the final quarter of the year, gaining almost 10 percent on the preceding quarter, compared to the just 3 percent gained by public markets.
Over a one-, three-, and 10-year period, private equity and venture capital funds gained pooled end-to-end returns, net of fees, expenses and carried interest, of 22 percent, 11.56 percent and 10.03 percent respectively, data showed.
In comparison, public markets over those three time periods returned 3.37 percent, 8.46 percent and 9.49 percent.
“This is a good set of numbers. The index has shown strong returns for the last six consecutive quarters, and the results from this most recent period are especially positive,” AVCAL chief executive Yasser El-Ansary said in a statement.
“We’re seeing significant new deal activity within the private equity industry at the moment, and we expect that many funds will maintain a focus on identifying new investment opportunities where growth can be unlocked through the injection of capital and skills.”
Dealflow has been picking up in the country, despite Australian regulators clamping down on the industry with regards to fees and transparency. In the first five months of 2014, announced private equity deals in the country reached $5.5 billion, higher than the amount for any full year since 2006, the Wall Street Journal reported this week, citing Dealogic data.