Monday August 31, 08:31 PM

Private equity emerging markets seen down in '09

DUBAI (Reuters) - Long-term prospects for the private equity sector in emerging markets remain upbeat, even as the industry expects activity to slow down further this year, research by Deloitte and Arbor Square shows.

"Given the financial and regulatory turmoil surrounding the industry, it is reassuring to see that the emerging markets still view the long-term potential of the industry positively," said Chris Ward, global head of corporate finance and chief executive of Deloitte Corporate Finance in the Middle East.

More than 47 percent of Middle Eastern and North African private equity firms surveyed in the study expect activity to increase in the next 12 months.

Better access to capital, lower valuations and growth in the mid-market will drive the increase, according to the report.

However, 40 percent of the participants expect a decline in private equity business due to the uncertain economy, valuation expectations and low liquidity.

The global economic crisis and the lack of liquidity caused a steep drop in private equity activity.

But as credit markets are gradually opening up again and governments in the Middle East region pledged to pour billions of dollars in infrastructure and transport sector, private equity activity is seen increasing again.

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