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18th October 2018

Private equity returns fall back from decade high, says eFront

eFront, the leading financial software and solutions provider dedicated to Alternative Investments, has published its latest Quarterly Private Equity Performance report, showing that LBO performance has fallen for three straight quarters from its 10-year high in 2017.

Key findings:

  • After reaching a peak of 1.49x in Q3 2017, the average return multiple achieved by active LBO funds has continued its retreat, back to the level of Q2 2017, at 1.45x.
  • Despite the fall, active global LBO funds have outperformed the average of 1.3x achieved between 2009-2018 by 0.15x.
  • The dispersion of performance between the top and bottom funds has stabilised at 1.34x, following a general trend towards a lower dispersion of returns, equating to reduced risk.
  • Q1 2018 recorded a sharp decrease of the average time-to-liquidity, to just 2.63 years.
  • In terms of vintage years, 2009 and 2014 are so far delivering strong performance, while 2010 and 2013 are more subdued.
  • Overall, the performance of US funds stands above or on the long-term average, while Western European LBO funds show a more volatile performance.
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