NYPPEX Report: Private Equity Funds Accurately Value Their Portfolio Companies
Update: I've received more details on this study from NYPPEX and included them below. The Private Equity Council has drawn my attention to a recent report from secondary intermediary NYPPEX, which states that buyout firms have accurately valued their portfolios. While the PEC didn't exactly explain how it found that, NYPPEX was nice enough to break it down for me. See, the study found that buyout funds net asset values as of June 30, 2009 quarterly reports were only 2.57% over-stated, compared with publicly-traded industrial companies. Enterprise value to EBITDA multiples declined from 9.75x to 6.54x or approx -32.92% for publicly traded industrial companies, versus buyout funds' worldwide net asset values, which changed approx -30.35%. NYPPEX tracked industrial companies because it considers those to be good barometers for portfolio company holdings in buyout funds. Also interesting-- NYPPEX expects secondary bids to rise by 25%. Guess all those secondary funds really did miss the bottom... More from the survey below:
