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This study investigates the private equity funds’ performances and persistence by fund type. Diversification benefit exists between public equity and private equity and among different types of private equity funds. The net IRR of private equity funds depends on fund type, economic growth, stock market performance, inflation and interest rate. Fund performance was negatively correlated with capital inflow to private equity market and fund size. Fund size and series are positively correlated. Performance persistency exists in private equity fund managers. Fund type is very important factor in analyzing private equity fund performance and persistency.

This paper aims to focus on the performance of private equity real estate funds. Since many institutional investors have special programs to invest with first time managers, or emerging fund managers, it also seeks further evidence on how persistent the performance of real estate funds is and how the growth in fund size affects the realised returns of a fund.

The analyses performed are based on a large global sample of value‐added and opportunistic private real estate funds. Different model specifications are used to study the fund and sponsor‐related factors' correlation with fund performance.

It is shown that the realised performance is positively correlated with fund size but negatively correlated with the sequence number of the fund supporting the fact that emerging managers are likelier to achieve good returns. The data also reveal trends in fund performance and the growth of the fund size. Evidence from private equity buy‐out funds has also shown that better performing fund managers are likely to raise follow‐on funds and often larger funds than poorly performing fund managers which is also confirmed by the findings of this paper. There is also an evidence that top‐performing funds do not grow proportionally as much as the average funds.

Actual datasets used in the regression models are often limited by exclusion of immature funds to enhance reliability of results.

This paper expands the recent studies on private equity to private real estate, an area that has experienced substantial growth during the past ten years.

The purpose of this paper is to describe an investment program that offers students with the opportunity to simultaneously manage a private asset fund and a public asset fund. The program has been in operation since 2013 and has made significant progress in student placement and connectivity with local, regional and national financial firms.

The authors describe the structure, methods used and challenges encountered in this dual portfolio environment and add relevant thoughts for discussion. The authors discuss potential conflicts of interests that may arise in managing a private equity portfolio, the concern of proper deal flow, the issue of the investment timeline when investing in private equity and the problems encountered when measuring private equity performance.

While public asset funds have been around for decades and are relatively well accepted throughout all levels and types of higher education institutions. The uses of private equity funds, though not unheard of, are much less prevalent. Allowing the same group of students to manage both type of portfolios is relatively unique and provides with a more comprehensive learning experience.

A primary distinguishing attribute of this program is that accepted students are given the opportunity to simultaneously manage both public and private equity assets throughout an academic year. The goal is to create a comprehensive portfolio management program that replicates a changing investment management environment where private equity is an increasingly significant asset class.

While Merger & Acquisition (M&A) activity has reached unprecedented levels over recent years, M&A failure rates remain high. Yet, there is growing evidence that private equity funds show high success rates. As little is known about the differences between different types of buyers, and only scant information exists on private equity funds’ operations, we inductively explore the reasons for their outperformance. In this qualitative study, we identify three characteristics (i.e., organizational set-up, private equity investors’ professional identities, and an integrative work approach), which we brought together into a theoretical framework that explains how private equity professionals can enable better M&A performance. Finally, our findings underline the effectiveness of specific incentivization approaches applied in private equity funds.

The paper's aim is to analyze and assess the importance of a recent US Court of Appeals for the First Circuit decision in the case of Sun Capital Partners III LP v. New England Teamsters and Trucking Industry Pension Fund with respect to the court's conclusion that a private equity fund constitutes a “trade or business” for purposes of the ERISA multiemployer pension withdrawal liability and that, therefore, the fund could, under a “piercing the veil” type of approach, be held liable for the ERISA withdrawal liability of a bankrupt portfolio company.

The paper provides historical background on termination and withdrawal liability under ERISA; explains the facts of the Sun Capital case; and offers preliminary reflections on the “investment plus” approach in ERISA context, the significance of the offset mechanism, why the Sun Capital decision is a significant victory for the Pension Benefit Guaranty Corporation, the liability of one portfolio company for the pension obligations of other portfolio companies owned by the same private equity fund, potential unintended consequences for tax-advantaged benefit plans of portfolio companies; the possibility that different pension plans at different portfolio companies may violate non-discrimination rules, the application of Sun Capital beyond ERISA, and the potential effect of this ruling on taxation of carried interest.

The employer and all “trades or businesses” in its “controlled group, including, under certain circumstances, a private equity fund, are liable for the employer's share of unfunded pension liabilities if the employer withdraws from a multi-employer defined-benefit pension plan.

Practical guidance from experienced financial services lawyers is given in the paper.

The purpose of this paper is to present a case study of UK fashion retailer New Look and focuses on the impact of private equity on corporate governance, employment and leverage after the public‐to‐private conversion in 2003.

This study follows a case study approach to offer in‐depth insights into the role of different parties in the deal and their perceptions. The case study is based on semi‐structured interviews with key management of New Look, partners of the private equity firms and other members of the New Look board. In addition, complements the analysis with secondary sources (e.g. analyst reports, published articles and financial data of New Look) in order to triangulate our findings.

The case presents an example of a company that pursued a public‐to‐private transaction with the support of private equity firms. The envisioned transformation process post‐transaction turned out to be highly successful with increasing efficiencies and profits as well as an increase of over 3,500 employees over four years. This paper analyses key success drivers and the role of the private equity firms in achieving this success.

The paper is the first in‐depth case study of a European public‐to‐private transaction with support of private equity that offers rich evidence on the impact of private equity on corporate governance, employment and leverage.

The purpose of this exploratory study is to gain a better understanding of the motivations behind private equity (PE) activities in Australia.

This paper reports findings arising from face‐to‐face semi‐structured interviews with individuals representing stakeholders in the market for private equity; namely, PE partners and finance professionals. Interviews were conducted in two stages, during the pre‐Global Financial Crisis (GFC) period (2007‐2008) and the post‐GFC period (2012).

In general, the stakeholders interviewed perceive that the motivations behind PE bids are not well understood, and they highlight the need for more education. They state that PE enables a company's management to make decisions more promptly; capture opportunities more effectively; reduce paperwork for executives; provide no accountability to a broad investor base; and most importantly create value for a business, as the ownership is more closely involved with the management in the day‐to‐day operations of the business. According to the interviewees, since the GFC, PE firm reputation and track record are considered to be even more crucial than before the GFC, as debt providers in particular have become more wary when lending.

The findings have implications for the agency relationship model. The principals' role might appear to be more tightly aligned with that of the agent, and so are their motivations, thus reducing monitoring costs, but post‐GFC interview responses indicate that this might not necessarily be the case. Concerns over empire building and gains through transaction costs were raised. The paper concludes by drawing from the insights gained by the authors from the interview data. Although it is only a small part of the economy's Gross Domestic Product, PE activity has helped Australia become a more competitive business economy.

This study investigates the media activities of firms issuing private equity placements and seasoned equity offerings in Taiwan, as firms have incentives to manage media coverage to influence their stock prices during private equity placement.

We collect a corpus of news stories and transform the news into term sets based on the part of speech. Then, we refer to Cecchini et al. (2010) to classify the news terms into positive, negative, and usual categories. Next, we employ the SVM algorithm to perform the classification tasks and the term frequency method to perform the text mining task. In last, we use a multiple regression model to verify the hypotheses.

We determine that issuing firms in a private placement have substantially more positive news stories and fewer negative news stories than those in public offerings. Furthermore, we evidence that the media management effects of postequity issues are more active than those of preequity issues. Finally, our results demonstrate that the timing and content of financial media coverage among different equity issuance methods may be biased by firm management. According to previous studies, they may attempt to manipulate stock prices to increase the number of highly profitable insider stakeholders.

To our knowledge, this is the first study to investigate that if private placement will associate with more active media management than the public offerings. According to our results of the difference-in-means test, the public offerings market may control news coverage; however, this result is inconsistent with that of the regression results. The private placements market may also exercise media management in the “before announcement day” and “after announcement day” periods by increasing positive news and reducing negative news.

Alice Handy, an investment professional with 30 years' experience as head of the University of Virginia Investment Management Company, has opened a new asset management firm targeted at midsize endowments and nonprofit institutions in January 2004. Her business, Investure, LLC, offered outsourced investment services to institutions with $150 million to $1 billion in assets and access to top-performing managers at lower cost than a fund of funds (FoF). Smith College, a prestigious liberal arts college with a nearly $1 billion endowment, is interested in increasing its current allocation to private equity. Handy and her partner are preparing to meet with Smith's trustees in an attempt to win Smith College as Investure's first client. The case presents three different approaches to private equity investing: direct investment through a traditional limited partnership, investment through a FoF, or investment through Investure's outsourced model. The class discussion presents an opportunity to evaluate advantages and shortcomings of each approach, introduce key terminology, and discuss the current trends in the private equity market. Students are given the cash inflows and outflows for a representative investment in a venture capital fund of the type Handy hopes to invest in on behalf of Smith College. The main analytical task requires students to evaluate the expected gross and net returns generated by the representative investment under each of the different approaches and fee structures.

This case was written for an early class in courses on entrepreneurial finance, venture capital, or private equity. It can also be used in specialized courses for fund trustees interested in alternative assets.

This study identifies the factors responsible for obtaining price premium on privately placed equity in a developing market.

We examine a unique data set of a special case of private placement of equity, Qualified Institutional Placement (QIP) in India purchased at a premium. The study analyzed 188 equity issues offered between September 2006 and December 2014. On average, we find that QIP issues received a price premium of 4.38%. The study employed binary probit and ordinary least square regression models to analyze the probability and magnitude of the premium.

The study attributes the price premium of QIP to certification effect through group affiliation, signaling through promoters' ownership and monitoring effect through existing institutional investors. These factors influence the probability of premium for QIP issues. However, group affiliation and institutional ownership do not significantly influence the magnitude of the premium.

The private placement of equity is usually offered at a discount. Our findings contribute to the existing literature by evaluating the premium obtained on private placement as a unique scenario in emerging market supported through certification hypothesis, monitoring hypothesis and signaling.