Less Private Equity-backed IPOs in one of the biggest bull markets?
I have a question for all of the private equity folks. I am wondering why there are less private-equity backed IPOs in one of the biggest bull markets?
I think one of the reasons is that LPs now want to receive cash as soon as they can. They do not want to have their stakes locked up in a public company even though they may get a higher valuation. The risk of market volatility prevents these companies to go IPO.
Therefore, they all want to get exits via acquisition. So they can get immediate liquidity albeit at possibly a lower valuation. However, I do see it as a risk if the market turns, and those same companies suffer, so they should seek liquidity through the public markets.
Thank you for any additional insight.
Valuations and prices in a bull market.
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