AVCJ

Australian PE investment at ‘highest level for three years’

  • Susannah Birkwood
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Private equity and venture capital firms contributed A$3.6 billion ($3.7 billion) of capital to Australian companies this year, representing the highest amount invested for three years.

More than 40% of the total was invested in a single transaction however - the A$1.99 billion buyout of hospitals and pathology services operator Healthscope by The Carlyle Group and TPG Capital.

According to the Australian Venture Capital Association (AVCAL), at 150, the number of firms which received investment is actually the lowest seen in recent years. This is thought to be because of greater investment selectivity and increasing specialization on the part of GPs.

Growth-stage businesses constituted more than a quarter of the companies receiving capital, while firms in the life sciences space accounted for almost half the total amount.

Five of this year's biggest deals were secondary buyouts, with SBOs experiencing a seven-fold increase on 2010 values.

Earlier this year, AVCAL released a governance code designed to enhance transparency in private equity. All AVCAL members are now obliged to implement it and if they elect not to adopt any aspect of it, they must be in a position to explain their decision.

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