Private Equity Investments in Emerging Markets, National Governance, and Geographic Distance: The Case of Latin America, 1996–2009

Mingo Del Rio, Santiago Julián; Morales, Francisco; Junkunc, Marc

Private Equity Investments in Emerging Markets, National Governance, and Geographic Distance: The Case of Latin America, 1996–2009

Date

2013

Authors

Mingo Del Rio, Santiago Julián

Morales, Francisco

Junkunc, Marc

Abstract

The high level of economic growth that emerging markets are experiencing lately — including Latin America — offers new opportunities for different types of investments. Private equity (PE) investments in emerging markets have risen from $3 billion in 2003 to almost $70 billion before the Great Recession of 2008–2009 (Emerging Markets Private Equity Association, 2010). In the case of Latin America, PE investments totalled more than $7 billion in 2010 (LAVCA, 2011). By private equity we mean “financing for early- and later-stage private companies from third-party investors seeking high returns based on both the risk profiles of the companies and the near-term illiquidity of these investments” (Leeds & Sunderland, 2003: 8). For instance, venture capital (VC) is a type of private equity focused on start-ups.