Private equity investors are increasingly looking to invest in emerging markets as those economies continue to show positive growth while developed economies struggle. PE fund managers believe emerging markets will provide attractive opportunities and plan to maintain or increase investments. A survey found Brazil, China, and India to be the most attractive investment destinations over the next year, with developing economies expected to make up 70-75% of global growth in the coming years.

1. PE investors bullish on emerging markets; to hike investments
April 10, 2009, 18:57 IST
Private equity investors are turning towards emerging economies, which have become attractive as they
continue to chart growth, while their developed peers are in negative terrain.
quot;Emerging economies have positive growth rates, while the developed peers are lagging in
negative zone. In such times PE players look forward to investing in those economies which can
absorb the shock and reap returns on their investment,quot; SMC Capital Equity Head
Jagannadham Thunuguntla said.
According to Emerging Market Private Equity Association, institutional investors believe
emerging markets will continue to present attractive investment opportunities in the coming year
and plan to maintain or expand their exposure.
quot;Investors recognise that emerging economies are the only ones still growing, and they also
know that, since private equity deals in emerging markets do not rely on debt, the collapse of the
global leveraged finance markets will not impede deal flow,quot; EMPEA President Sarah Alexander
said.
Of the BRIC (Brazil, Russia, India, China) economies, the fund partners ranked Brazil as the
second most attractive destination for investment in the next 12 months behind China and just
ahead of India, according to a survey by EMPEA.
Allan Conway, who manages $11 billion in emerging equity markets, is confident about the
performance of this asset class over the next two to three years. Developing economies will
account for 70 percent to 75 percent of the world’s growth “for the foreseeable future” and,
because they do not suffer from the same economic disease that plagues the developed world,
their fundamentals are much better in comparison, he argued. Zimbabwean cabinet ministers
belonging to President Robert Mugabe’s ZANU-PF party and former members of the Joint
Operations Command of security agency chiefs are said to have joined forces in a shadowy
group calling itself the Social Revolutionary Council designed to frustrate the aims of Prime
Minister Morgan Tsvangirai, political sources say. Members of the group are said to include
Defense Minister Emmerson Mnangagwa, State Security Minister Didymus Mutasa, Reserve
Bank of Zimbabwe Governor Gideon Gono and the commanders of the army and air force,
government and party sources said. Mnangagwa, considered a potential successor to Mr. Mugabe
as ZANU-PF chief and as that party’s next presidential contender, declined to comment, as did
Mutasa. The Joint Operations Command, commonly referred to as the JOC, was said to have
exerted significant influence over President Mugabe following his defeat by Mr. Tsvangirai in
the first round of presidential voting on March 29, 2008, and to have coordinated the deadly
wave of political violence that preceded the presidential runoff ballot on June 27. Mr. Tsvangirai
withdrew from that runoff in protest of the violence against his supporters.