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AltAssets is the private equity news and research service from Almeida Capital
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PRINT THIS PAGE The nature of private equity - The stages and types of private equity financing27/09/2006. Source: Euromoney Institutional Investor. 
Companies that do not qualify to issue securities to raise capital on the public, organised securities markets, or that choose not to do so, often turn to the private equity market for their financing requirements. This is a sample chapter from the book Adding Value in Private Equity - Lessons from Mature and Emerging Markets. The PE market over the past few decades has constituted an important source of financing for start-up companies, private companies that have been operating for some time and are seeking to expand their operations in what is often referred to as a middle market, companies with financial problems, and established companies that want to alter their ownership structure materially for which buyout financing is required.
Post-2000, a few additional categories have been introduced to the PE market. These include companies involved in various aspects of real estate financing, investment companies and special purpose vehicles (SPVs) established for the purpose of offering financially engineered products to investors, and equity interests in secondary PE funds.
A useful way of thinking about the needs and characteristics of each type of financing under the PE heading is in terms of the stage of financing in a private company’s life. Each of three main stages – the venture capital stage, expansion stage and acquisition/buyout stage – can be further subdivided into sub-stages.
Click here to view the full chapter from Adding Value in Private Equity - Lessons from Mature and Emerging Markets (pdf 271kb)You need Adobe Acrobat to read this document. If you do not have it, you can download it free from www.adobe.com/products/acrobat/readstep.html
For more information on the book or to buy a copy click here.
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