Private Equity Investment Fund Exit

As a new type of financial intermediary, private equity funds not only play an important role in international financial markets, but also stimulate the economic development of the countries. It can meet the financing needs of the small and medium sized enterprise, support venture capital and promote the integration of excessive competing industry.Private equity investment includes three important segments: capital raising, project selection and exit. Exit is the most important one of the three, because all the efforts can receive the returns in the exit process. A successful exit can not only gain a satisfying profit, but also help private equity investment company set up a good reputation, which helps the next round of investment convince more investors to raise more funds.Private equity funds started late and developed fast in China, the legal and capital environment have lagged far behind and many problems have come out in the exit process. To improve the exit mechanism is of great significance in promoting the development of private equity investment funds.This thesis is mainly composed of five chapters. The first chapter introduces the background and significance of the topic, the briefly review of the concept of private equity investment funds and exit theory; The second chapter is about the general theory of private equity investments, it includes a comprehensive introduction of private equity; The third chapter is exit theory, it respectively compared the main exit strategies, such as IPO, mergers and acquisitions, management buy-back, the second sale and bankruptcy liquidation; The fourth chapter is the analysis of exit problems of China's private equity investment, based on the introduction of the history and current situation of private equity in China; The fifth chapter seeks to find the ways to ease the obstacles and problems from the development environment, the industry, and the choosing of the exit strategies. IPO should be gradually replaced by M&A, and become the preferred exit strategy.