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Texas, California among states getting most private equity cash

Texas, California, Pennsylvania, New York and Florida received the most investment from private equity firms last year, according to a new report by an industry association.

PE firms invested more than $443 billion in U.S.-based companies last year, a 27 percent increase over 2012, according to the Private Equity Growth Capital Council's fourth annual report on the subject.

Texas received the most investment from private equity for the third year in a row, totaling $87.4 billion in 282 companies. The Lone Star State beat second-place California and third-ranking Pennsylvania, which moved up from sixth place in 2012. Other states that moved up in the rankings included Virginia, which jumped from 16th to seventh, and Maryland, Delaware and Minnesota, which moved into the top 20, according to the report.

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Top states for private equity investment in 2013

Rank
State
Number of
Companies
Capital Invested
(Billion)
1 Texas 282 $87.4
2 California 304 $54
3 Pennsylvania 91 $44.4
4 New York 162 $31.5
5 Florida 136 $18.9
6 Illinois 96 $16.7
7 Virginia 66 $14.7
8 Massachusetts 98 $14
9 New Jersey 84 $12.6
10 Georgia 78 $11.5
11 Maryland 57 $9.7
12 Ohio 76 $9
13 Colorado 66 $8.9
14 North Carolina 65 $8.4
15 Oklahoma 38 $8.2
16 Tennessee 53 $7.7
17 Minnesota 51 $6.9
18 Delaware 7 $6.9
19 Michigan 50 $6.7
20 Wisconsin 37 $5.9
- U.S. Total 2,368 $443.4
Source: PitchBook via PEGCC

"Private equity investment is long-term capital at work," Steve Judge, president and CEO of PEGCC, said in a statement. "The companies in states across the country that receive private equity investment are able to expand their businesses, develop new innovations and hire workers and this report highlights the important contributions of private equity in the U.S. economy."

Of investments in 2013, information technology, consumer and business services sectors attracted the majority of PE investment.

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The report, based on PitchBook data, also ranked the congressional districts that received the most investment dollars.

The 31st District in Texas, north of Austin, represented by Republican Rep. John Carter, received the most money ($24.9 billion in two companies). Second was the 14th District in Pennsylvania around Pittsburgh, represented by Democrat Mike Doyle ($24.8 billion in nine companies). Third was the 7th District in Texas near Houston, represented by Republican John Culberson ($14.6 billion in 27 companies).

"Perception ultimately impacts policy, which is why it is important that lawmakers understand that private equity investment is not something that occurs only within the financial hubs of the country," said Ken Spain, vice president of public affairs and communications at PEGCC, in an email to CNBC about the congressional ranking. "It plays a prominent role in growing and strengthening businesses in every state and congressional district across the U.S."

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By CNBC's Lawrence Delevingne

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