Investors are becoming more cautious about private equity

Frankfurt For the first time in years, institutional financiers for the private equity sector are holding back. While the commitments to private equity funds only increased during the boom phase, the uncertain economic and interest rate prospects are now having a slowing effect. The number of investors planning to increase their allocation to private equity has declined over the past six months.

Private equity is the generic term for funds that buy medium-sized companies and parts of groups, restructure them over several years and then resell them, usually at a higher price. Currently, only 27 percent plan to increase their private equity exposure over the next 12 months, up from 42 percent in the summer, according to Coller Capital’s Global Private Equity Barometer.