New commitments to Australia funds plunge

The decline of A$2.4 billion is the largest on record.

New capital committed to Australian later stage private equity and venture capital funds plunged by A$2.4 billion (€1.58 billion; $2.16 billion) or 77 percent in 2013, according to a statement from the Australian Bureau of Statistics, highlighting the tough fundraising climate in Australia. 

New commitments made in financial year 2013 (to June 30) totaled A$704 million compared to $3.1 billion in the previous financial year.

“This is the largest decrease we have seen since we first started publishing this data for the 2004-05 financial year,” said Tracey Rowley, assistant director of research and development surveys, in the statement.

“It appears Australian funds found it difficult to attract further capital from investors on the back of a peak capital raising period last financial year.”

Also, the net value of all exits were down 27 percent to $1.25 billion in financial year 2013.

Deals fell 1 percent to A$919 million across 76 transactions compared to $924m across 99 deals year prior, ABS data showed.

However, existing investments performed well. “Ongoing investments are revalued each year, and this year resulted in an increase of $906 million, which is the highest figure in over 10 years”, Rowley said.