Exits (a.k.a. Divestments or Realizations)

The means by which a private equity firm realizes a return on its investment. Private equity investors generally receive their principal returns via a capital gain on the sale or flotation of investments. Exit methods include a trade sale (most common), flotation on a stock exchange (common), a share repurchase by the company or its management or a refinancing of the business (least common). Secondary purchases of a PE firm's interest by another private equity firm is becoming an increasingly common phenomenon.