And the best private equity firm is…

But, in the end, only one ranking really matters: Who has the best performance?

And it seems that there is an answer, despite the private equity industry’s typical reluctance to discuss its returns.

Oliver Gottschlag, a professor of management strategy at HEC in Paris, recently teamed up with Dow Jones to determine the best-performing private equity firm of the past 10 years. They only included firms that had raised at least two funds during the period, with aggregate capital exceeding $500 million. In addition, they only included firms for which they could obtain performance data — most of which came from industry research firm Preqin, which solicits such information from public-sector investors (pension funds, etc.) and some of its own private clients.

All in, that gave Gottschlag 98 firms that raised 273 funds during the period, representing $411 billion in total equity. And the winner was…

Leonard Green & Partners, the Los Angeles-based firm currently in the hunt for such companies as J. Crew (JCG), BJ’s Wholesale Club (BJ) and The Palms Casino Resort. Gottschlag does not disclose Leonard Green’s specific performance data — likely due to a non-disclosure agreement with Preqin — but does give it an aggregate performance score of 3.33. For context, the 10th firm on the list, AXA Private Equity, received a score of 1.08.

Here is Gottschlag’s explanation of the scores:

The aggregate performance score is neither an IRR-type annual return measure nor a money multiple. It can only be interpreted relative to the average aggregate performance score of all firms we analyzed: An aggregate performance score of 1 means that a given PE Firm has an aggregate performance that is one “standard deviation” above the average performance, which would position it typically at the 85th percentile, i.e. 85% of all firms would have a lower aggregate performance. Also, an aggregate performance score of 2 means that performance is twice as high as for an aggregate performance score of 1. A PE Firm with the average performance has (by design) an aggregate performance score of 0.

Here is the full top 20 (yes, there does seem to be some European bias, save for Leonard Green nabbing the top spot):

1. Leonard Green & Partners (3.33)
2. Astorg Partners (3.0)
3. Waterland Private Equity (2.27)
4. Hellman & Friedman (2.11)
5. Lincolnshire Management (2.02)
6. Nordic Capital (1.68)
7. BC Partners (1.25)
8. Permira (1.17)
9. TowerBrook Capital Partners (1.16)
10. AXA Private Equity (1.08)
11. Friedman Fleischer & Lowe (1.07)
12. Sterling Group (1.0)
13. Barclays Private Equity (0.86)
14. Onex Corp. (0.85)
15. Gilde Buy Out Partners (0.85)
16. LGV (0.85)
17. Altor Equity Partners (0.81)
18. Blum Capital Partners (0.79)
19. Berkshire Partners (0.77)
20. Charlesbank Capital Partners (0.76)