private equity

Australian investors have poured money into private equity (PE) investments in recent years, but asset valuations are prone to the same combination of multiple and margin compression, and interest-rate pressure, that affects the listed markets. A big chunk of the pile of PE value is potentially facing high fire risk.

What the Brisbane-based lower-mid tier private equity group is pulling off is emblematic of the success private equity players are enjoying in recent times. But each PE player has their own unique strategy that largely defines just how well they’re doing.

Companies are eschewing publicly listed markets in favour of private ownership, which has warped the availability of information to investors. For those with access, the advantage is heightened in certain sectors.

The phenomenal growth of private equity’s big players has left a yawning gap in the lower-mid market, which enterprising players like Fortitude Investment Partners are all-too keen to step in to and take advantage of.

The Brisbane-based private equity team has made a point of seeking out investee companies that are well equipped to handle a slow-motion recovery in the domestic economy.

The Brisbane-based private equity team is backing the further expansion of its New Zealand-based Action Adventures, which has just made its second US company acquisition.

“There are a range of different ways to invest in the energy transition thematic,” Fortitude explains, adding that the opportunities on the periphery often present the greatest value.

Cashed-up baby boomers in the market for yield are finding that it’s increasingly being delivered by non-listed assets with a palatable risk profile. And that’s not the only tailwind behind the burgeoning sector.

The NZ science and technology investors are onto their fourth fund, which is shaping up as their biggest yet. Savvy investment and active ownership have been key ingredients so far, along with support from the NZ government.

After a “frenzy” in the pre-pandemic era, markets have calmed down significantly for private equity investment teams. There are opportunities, however, especially for management teams with patience and a little bit of nous.