NEW YORK (Dow Jones)--Private equity buyers in Latin America exercise an active role in the companies they take a stake in, despite their minority ownership positions, according to a study released Wednesday.

These investors chart a value-creation road map and even have some of their employees work on the staff of their portfolio companies in order to adhere to this path, a joint study by the Emerging Market Private Equity Association and Ernst & Young revealed.

The high returns and the prospect of working closely with portfolio companies to create added value have lured investors to Latin America, especially Brazil. The region drew $8.4 billion in new commitments in 2011, out of which Brazil drew $7 billion, data showed.

In looking at the exits of private equity firms, which typically like to sell out of their investments after five years, it showed a dearth of exit routes. Most of the sales were to trade buyers or through initial public offering, while exit to other private equity firms contributed to only 5% of the total.

\"A robust secondary market, and the greater cohesion that would bring to the ecosystem, may become more critical as these markets continue to attract investors,\" said Jennifer Choi, EMPEA\'s vice president for industry and external affairs, and a co-author of the study.

Most of the deals studied were minority ownership positions with median equity values of $41 million, and the size dropped to $18 million for the region without including Brazil. Investments ranged from consumer service companies to healthcare.

Investors found their own deals, according to two-thirds of those surveyed. The model of working closely with portfolio companies to create value helped these firms realize average EBITDA growth of 45% in Latin America compared with 13.5% in the U.S. and Europe.

By Prabha Natarajan, Dow Jones Newswires; 212-416-2468; prabha.natarajan@dowjones.com; @djfxtrader

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