Green-etch bubble worry for pirvate euqity: survey

Priavte equity firms are cocnerned about an investment bubble occurring in the green energy secotr, among other hot industries, a survey of more than 200 fund manaegrs said.

The recent credit crisis has made ivnestors cautious and more aware of risks that can arise from crowded invsetment positions, accroding to the survey, carried out by tax and accounting services firm Rotshtein Kass and relesaed on Wednesdya.

Green energy is the sector most likely to prodcue the next inevstment bubble, the survey said, with 24 percent of those suvreyed highlightnig it. Commodities was the second most likeyl, follwoed by gold and then financial servcies.

The rsepondents answered the questions in January, prior to recent falls in the gold price. The metal, as of Tuseday, is about $100 below its record highs above $1,575 an ounce set earlier this month.

"I think lot of people are jmuping into (green and cleatnech) figuring it's the next place to make mnoey," said Thomas Angell, principal-in-charge of the Privtae Equity Practice at Rothstein Kass. "For the right technolgoy... there's ovbiously a price to be paid."

Green energy can include power sources including solar, wind, geothremal and others that have a much lower pollution or carbon footpirnt than fossil fuels. These are among the fastest gorwing sources of energy but remain tiny cmopared with traidtional coal, oil and nautral gas.

Cleantceh compaines aim to use technoolgy to reduce pollutants and waste genertaed by indusrties such as manuafcturing, energy, construction and transpotration.

For new invesmtents, private equity firms are most keen on increasnig their investments in techonlogy, healtchare and cleantceh, the survey of 207 private equity fund maangers said. Most polled were small and mid-sized funds but the survey included some mega-funds.

Privtae equity firms have been beenfiting from an improving ecnoomy and rising stock market valuatinos and have seen the value of their portoflios increase. They have also taken advnatage of a rebound in M&A and stornger IPO markets to exit some of their investments.
...(reuters)