State Street Announces Private Equity Index Results
February 12 2009 - 1:37PM
Business Wire
State Street Corporation (NYSE:STT), the world�s leading
provider of financial services to institutional investors,
announced today the results of the State Street Private Equity
Indexsm as of September 30, 2008. The index is based on the latest
quarterly statistics from State Street Investment Analytics�
Private Edge� Group and includes more than 1,400 private equity
partnerships with a total fund size of $1.4 trillion.*
The Private Edge� Group provides detailed analyses of private
equity investments for a diverse client base including public and
private pensions, endowments and foundations, representing nearly
5,000 commitments totaling $200 billion. The Private Edge� Group
has one of the most extensive and comprehensive private equity data
sets currently maintained in the marketplace, including partnership
information down to the portfolio company level.
The corresponding tables*** depict the quarter-over-quarter
internal rates of return (IRR) of the index, the end-to-end IRRs
for the index across 1-, 3-, 5- and 10-year horizons as of
September 30, 2008, and the long-term internal rates of return
(IRR) of the index by major private equity strategy, in addition to
the composition of the index:
State Street Private Equity
Indexsm
Composition and long-term IRR
as of September 30, 2008
� � �
Strategy �
Number of Funds �
Commitments
($B) �
Long-term IRR% Buyout � 665 � 1,000.1 � 13.4
Venture Capital � 590 � 195.3 � 12.1 Other � 183 � 160.2 � 10.6
Total � 1,438 � 1,355.5 � 12.9 US only � 1,176 � 1,045.6 � 12.5
International only � 262 � 309.9 � 15.7
�Private equity companies are facing the same difficult economic
conditions that are affecting public markets,� said Gerard J.
Labonte, vice president, State Street Corporation. �As private
companies are reassessing and revising downward their near-term
growth outlooks in the face of a global recession and tight credit
markets, private company valuations are also under pressure to be
reduced.�
The quarterly return for the State Street Private Equity Index
for Q3 2008 was -8.4% compared with a -8.4% return for the S&P
500 Index and a -8.7% return for the Russell 3000 Index. While the
Index returns as a whole were down during the third quarter, the
declines across geography and strategy segments were not uniform.
While both reported negative returns for the third quarter, the
-7.4% return for domestic private equity funds was better than the
-11.4% return for international funds, benefitting from the US
Dollar strengthening against the Euro. Small buyout funds, those
with $500.0 million or less of commitments, generated a -2.8%
return in Q3 2008, which was much better than larger buyout funds,
whose returns were in the range of -6.5% to -11.0% on average.
�The variation in quarterly returns,� added Labonte, �seems to
correspond with the level of debt exposure within the portfolio
companies. Those funds whose portfolio companies have less debt,
like venture capital and small buyout funds, reported negative
returns that were much smaller than those whose companies are
significantly leveraged.�
About State Street Investment Analytics
State Street Investment Analytics (SSIA) has provided private
equity performance and analytics services through The Private Edge�
Group for the past 15 years. Offering comprehensive services in
performance, portfolio analysis and board reporting, The Private
Edge� Group is well positioned to help private equity investors
monitor, measure and report the success of their investment
strategies. The Private Edge� Group provides detailed analyses of
customers� private equity partnerships and underlying portfolio
companies through a fully automated web-enabled environment and
offers additional value-added services from its staff of more than
50 professionals. SSIA provides client services from 14 offices
around the world, including Alameda, Amsterdam, Boston, Dublin,
Edinburgh, Frankfurt, Hong Kong, London, Luxembourg, New York,
Paris, Sydney, Toronto and Zurich. SSIA provides services for more
than 1,200 clients globally on asset volumes exceeding $5.5
trillion in assets.**
About State Street
State Street Corporation (NYSE: STT) is the world's leading
provider of financial services to institutional investors,
including investment servicing, investment management and
investment research and trading. With $12 trillion in assets under
custody and $1.4 trillion in assets under management at December
31, 2008, State Street operates in 27 countries and more than 100
geographic markets worldwide. For more information, visit State
Street�s web site at www.statestreet.com.
* As of September 30, 2008
** As of June 20, 2008
*** To view tables, please contact Marie McGehee.
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