Top private equity firms rule industry

GOLDMAN Sachs Principal Investment Area has leapfrogged rivals TPG, KKR and Carlyle to take top spot in this year’s ranking of the world’s leading 300 private equity firms produced annually by Private Equity International magazine.

The report, which ranks firms in terms of the amount of direct investment capital each has raised over a five-year period, placed CVC Capital Partners the highest-ranked London-based firm with sixth place, Apax Partners was in 10th, Permira at 16th and Terra Firma at 19th.

According to the report, the stability of many of the names on the list is owed largely to the long-term structure of private equity partnerships. For example, those firms that raised big funds ahead of 2008 remained ahead in the rankings as they still manage that money. The list includes a scattering of upwardly mobile general partners and newcomers highlighting that demand for fresh talent has remained strong even during the recession.

“Going forward, expect to see a changing of the guard play out in slow motion as the strongest franchises gradually win commitment dollars away from firms whose best years lie in the past,” the report concludes.