Investors in Australian private equity funds face a cumulative $25 billion wipeout as valuations for portfolio businesses can no longer escape the effect of higher interest rates, shrunken profit margins and reduced prices for benchmark assets.
New research by global consulting firm Alvarez & Marsal concluded that a near tripling in capital deployed, from $22 billion in 2020 to $146 billion in 2022, will mean some losing bets.
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Jonathan Shapiro writes about banking and finance, specialising in hedge funds, corporate debt, private equity and investment banking. He is based in Sydney. Connect with Jonathan on Twitter. Email Jonathan at jonathan.shapiro@afr.com
