Then there were 300

Our job at Private Equity International is to help you connect intelligently with the best people, ideas and sources of capital in the global private equity market. At the risk of sounding immodest, I think we've delivered that in spades with the May issue you now hold.

Consider the main features this month: a report on the state of debt financing markets; a roundtable discussion with some of the top LPs and LP advisors in the world; and a list of the largest 300 private equity firms globally, who together have sponsored some 87 percent of all private equity deal volume in the world over the past five years.

I refer now to the PEI 300, which begins on p. 59. This ranking is an expansion of the popular PEI 50 list that we produced in 2007 and 2008. The PEI 300 ranks private equity firms by “size”, which we define as the amount of private equity direct investment capital raised over the most recent five-year period. This apples-to-apples methodology captures a firm's recent buying power in the market as well as its fundraising momentum.

Once you get past the top 50 firms, which are mostly based in the US and the UK, the PEI 300 becomes filled with international intrigue. Who knew, for example, that Dubai-based Abraaj Capital would be the largest non-Western private equity firm in the world, or that a Brazilian firm, GP Investments, would be the world's number 120?

Equally revealing is the diversity of business models among the firms. While most are managers of limited partnerships, some major players, like CPP Investment Board and Arcapita have been regularly deploying direct investment capital formed in other ways. All are important participants in the private equity market, and you can get a sense of their heft from the PEI 300.

One reality about the PEI 300 that is both exciting and frustrating at the same time – it is constantly in need of an update. At press time, for example, details emerged about the carve-up of Lehman Brothers Private Equity that will certainly delete that particular entity from next year's list. The fact that we have Lehman at number 24 this year is evidence of the pace of change in the market. Private equity firms are people, and people can rapidly regroup to meet new opportunities. This is why we think the PEI 300 will look quite different from year to year, and why we think you'll find it a useful guide to the universe of private equity firms.

Enjoy the issue,

By David SnowDavid.s@peimedia.com