Legal & Finance: Research Shows Firms Moving toward Private Equity Funding
Increasing numbers of middle market firms are considering the use of private equity as a means of raising funds, according to research by KPMG.
A third of middle market firms say that they are pondering using private equity funding in the next couple of years.
The research, carried out for the accountancy firm by the Economist Intelligence Unit among middle market companies with turnovers of up to pounds 500 million, found that 32 per cent believe private equity to be the most suitable source of new finance and expansion capital.
In previous KPMG research, carried out last autumn, only 17 per cent said private equity would be their most likely funding route.
The chief attraction of private equity finance was that it enabled a firm to acquire investors with long-term horizons. It is also, in the view of companies, a relatively cheap way of raising finance.
However, bank financing remains the most popular vehicle overall. …