Buyout firms have most to spend in U.S. - Preqin

Thu Jan 26, 2012 10:17am EST

(Reuters) - Private equity has $193.1 billion to spend on buyouts in North America, more than the capital available for all the other regions combined, with Blackstone Group LP (BX.N) having the most to draw on, research firm Preqin said on Wednesday.

Buyout firms are seen as the lifeblood of mergers and acquisitions activity, creating a market for companies to sell assets or themselves and boosting the valuation of publicly listed firms perceived as potential takeover targets.

The capital available globally for buyout deals, or "dry powder", has come down to $370.3 billion from a peak of $487.6 billion in 2008, as the financial crisis squeezed fundraising, the source of capital that buyout firms tap to write equity checks for their deals, Preqin said.

A focus on the United States as a private-equity powerhouse has led to North America claiming 52 percent of the dry powder available worldwide. European-focused buyout funds have $124.1 billion of dry powder, while buyout firms focused on Asia and rest of world have $53.1 billion to draw on, Preqin estimated.

U.S. private equity outfits also dominate the ranks of firms with the most dry powder. Blackstone has an estimated $20.6 billion on hand, Goldman Sachs' (GS.N) merchant banking division has $17.9 billion available, while Carlyle Group has $12.9 billion, Preqin said.

Several private equity firms have diversified beyond buyouts into other alternative assets such as real estate, infrastructure and hedge funds. Data gathered by Preqin shows dry powder in some of those sectors increasing.

Capital for mezzanine-debt investments available globally to private-equity firms has reached a high of $45.3 billion, real estate is up to $161.1 billion from $158.2 billion at the end of 2010, and venture capital is at $116.6 billion from $113.4 billion at the end of 2010.

(Reporting by Greg Roumeliotis in New York; editing by Mark Porter)

Corrects estimate of Blackstone's reserves in paragraph 5 to $20.6 billion, not $206 billion

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