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Insurance Companies and Private Equity Activity in Emerging Markets

by Louise Weller

  • 22 Feb 2011
  • PE

Preqin’s Investor Intelligence database tracks 211 insurance companies - with aggregated total assets of more than USD 12.7 trillion - and their activity within the private equity sphere. The growth of new economic regions such as emerging markets is becoming increasingly important within the private equity asset class, with Preqin data indicating that 31% of insurance companies investing in private equity are willing to participate in funds focused on emerging markets.

When this data is broken down by geographical location, 46% of insurance companies with a preference for funds focusing on emerging markets are based in Europe, followed by 22% in North America. Insurance companies located in emerging markets themselves make up 18% and 14% are located elsewhere in the world.

Our research also indicates that 37% of insurance companies investing in private equity have previously made a commitment to a fund targeting emerging markets. 42% of such investors are based in Europe with more than two-fifths of these located in the Nordic region.

When looking at previous private equity fund commitments made by insurance companies by fund vintage year, more insurance companies committed to vehicles focusing on emerging markets from 2006-2010 than 2001-2005. With funds focusing on emerging markets with a vintage year from 2001-2005, 15% of insurance companies made at least one commitment to such funds, compared with 17% committing to funds with a vintage year from 2006-2010. When analysed geographically, approximately 37% of insurance companies that committed to a fund with a vintage year from 2001-2005 were located in emerging markets, 44% were based in Europe, 13% in the US and 6% were located across the rest of the world. Comparing this to insurance companies that committed to a fund focused on emerging markets with a vintage year from 2006-2010, approximately 45% were based in Europe, 23% North America, 26% located in emerging markets and 6% were based elsewhere.

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