Which country saw businesses perform the most private equity deals so far in 2013?
Here is what the deal volume looks like across country by dollar size and geographic boundary through the first week of October.
It likely comes as no surprise that businesses in the United States saw the largest dollar deal volume, with a total of $140.2 billion in total announced, potential deals. Far behind businesses located in the United States are businesses located in the Germany, with a total deal volume of $13.5 billion. The remainder of the top ten geographic areas with the most private equity dollar deal volume include Sweden at $11.5 billion, Canada at $7.6 billion, United Kingdom at $7.4 billion, China at $6.8 billion, Spain at $5.0 billion, Netherlands at $4.8 billion, Norway at $3.9 billion, and Russia at $3.7 billion. All other nations have not seen private equity dollar deal volume cross the $3 billion mark yet (that is, as of October 4th).
U.S. Holds Large Lead on PE Deals
In total, the private equity deals located within the United States account for about 62 percent of total deal volume worldwide, with Germany the next closest at almost 6 percent.
The story of U.S.-based businesses dominating the dollar deal volume also holds when looking at the figures by equity volume. The following figure displays the data.
Overall, as with dollar deal volume, the equity deal volume figures show businesses located in the United States well ahead of businesses located in other countries, although the list from second on down switches the ordering of certain countries when comparing this list to the dollar volume list.
In total, businesses located in the United States have announced potential equity deal volume of about $76.5 billion. The U.S. is followed by businesses located in the United Kingdom at $8.3 billion, Canada at $6.0 billion, China at $4.9 billion, Sweden at $4.8 billion, India at $3.4 billion, Russia at $2.9 billion, Germany at $2.8 billion, Japan at $2.8 billion, South Korea at $$1.9 billion, Netherlands at $1.8 billion, Malaysia at $1.7 billion, and Brazil at $1.0 billion. All other country have seen business equity volume below the $1 billion mark.
In terms of percentage take, businesses located in the United States are at about 59 percent. The next closest nation with equity volume is the United Kingdom at 6 percent.
Several Reasons Why Businesses in the U.S. Have a Sizeable Advantage
First, businesses in the United States have first mover advantage, meaning the United States was the first country to see the incredible good that can come out of the connection between financial capital and entrepreneurship.
Second, businesses have a strong, although weakening advantage, in the technology sector. The lead in the technology sector is important in that private equity is closely connected to private equity activity.
Third, the U.S. has implemented certain tax advantages to private equity activity.
Fourth, businesses in the United States have developed geographic clustering competitive advantages.
Fifth, individuals in the U.S. tend to be more entrepreneurial, or at least have the reputation of being so (evidence of this also shows up in such figures as business start-ups and failures).
Overall, private equity activity continues to move forward through the first nine months of 2013. In total, businesses located in the United States have a sizable lead in private equity deal volume, capturing about 62 percent of the total dollar volume market.
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