May 2005 Issue

May issue

News analysis

Euro venture, stuck in the shadows

Bumper fund raising times are upon us, if you’re in the buyout arena at least, just a quick flit through the funds section of this issue pays testament to that fact. European venture funds, however, are still waiting in the wings hoping that although today they are playing Cinderella to the big bumptious buyout funds’ stepsister, tomorrow they’ll be dancing at the LPs ball, darlings of all assembled, a position more akin to their US venture counterparts. Lisa Bushrod reports.

More debt and more distress

The topic of debt multiples is one you can’t seem to escape at the moment. Go to any conference and there’s sure to be at least one session dedicated to the subject, and the issue will be raised in numerous others. The concern among many, and voiced at February’s Super Return conference by Alchemy chief Jon Moulton, is that the current levels of debt multiples are creating the next generation of distressed companies. But there is another argument that says these fears are exaggerated, based on a memory of the heady leverage days in the 1980s. Tom Allchorne reports

Will individuals net something of high worth?

Whatever the current disparity in fund raising fortunes between buyout and venture investment firms in Europe, they are all seeking from the same, largely institutional investor, pot. Despite this, the make up of investors in private equity funds is beginning to shift, albeit slowly. In light of this, the European Private Equity & Venture Capital Association commissioned some research, published this spring, on the growing influence of family offices investing in private equity. Lisa Bushrod reports.

News highlights

Lloyds TSB Corporate targets larger deals

Making Europe a priority

Euro VC market back on track

SCM predicts record year for Euro buyouts

Partners Group opens London office

PEIGG releases US performance guidelines

Close Brothers new PE group

AXA PE internationalises its activities

Bullhound & GP Capital merge

UK Venture Index launched

Secondary LBO paper trades rationally

Fund news

Carlyle fund raising

CapMan Mezzanine IV fund closes on €240m

Penta expands fund

ECI closes on £255m

Advent Int’l closes €2.5bn fund

PAI Europe IV reaches €2.7bn

AGF launches fourth fund

Solid Capital launch fund

Egeria holds interim close on second fund

Finadvance raises 3rd LBO fund

Advent closes 3rd CEE fund

Astorg Partners closes 3rd LBO fund

Exit news

Strix sold to ABN AMRO Capital

CapMan sells Setec

Advent Int’l sells Aviagen

Graphite sells Ashbourne

Industri Kapital exits Laho Equipment

Charterhouse sells Tussauds

Flender exit for CVC

Barclays PE & 3i sell stake in INBIS Group

3i exits Morgan McKinley

CapMan & Eqvitec sell Normet

Partial exit for CapMan of Tamore

Sigma Technology floats Vividas

Bowmark Capital sells Living Ventures

EQT sells Dometic in secondary deal

CBPE sells NDR

Phoenix sells Mill House in secondary buyout

Ciao float provides VCs with exit

Barclays PE exits Cameca in secondary deal

Bain exits Jack Wolfskin in secondary deal

Igeneon sold by VC backers

Carlyle exits Apama

IDM exits in all share deal

DEWB exits OASIS SiliconSystems

AAC Cosmos sold to management

Datamars in secondary buyout

Covenant secondary buyout

LDC sells Xpert

Segulah recaps Callenberg

Baring Corilius exits Allami

Close Venture make 2.9x return on exit

Gresham exits MSS

Bridgepoint sells Erftcarbon

EI exits Orange Romania

PPM sells Astron Group

Hardide floats on AIM

Cinven sells Dynacast and McKechnie

BC Partners to sell Polyconcept

Mölnlycke Health Care in secondary buyout

Barclays Private Equity sells DCK stake


US investment figs Q1 2005

Italians release investment & performance data

VCT fund raising strong

Euro buyouts break records

Irish tech strong in Q1

UK MBO market still buoyant

US venture-backed IPOs Q1 2005

US venture returns Q4 2004 released


CBCF rebrands

PwC poach Sprague from KPMG

Sofinnova appoints managing partner

Cipio Partners appts

ABN AMRO promotes

Hicks Muse appts

Partners Group in London

Nikko appts

Change Capital gets Hicks Muse director

ISIS appts

New chairs at CapMan

Wellington appts

VCM recruits

New MD for BoA

CIBC new exec

PwC’s McKee wins award

MTI planning US expansion

Tehranian leaves GMT

AXA adds to exec committee

AXA Private Equity has appointed Stephan Illenberger, the managing director

IDG gets new GP

T-Ventures appts MD

Waterland hires new principal

SEP creates IR role

LDC strengthens team

Reed Smith hires new partner

ATP recruits

Actis appts directors

Linklaters appts partners


Venture capital turning a corner in France

Who says the French don’t have a word for entrepreneur? George W Bush does if you believe press reports. But that perception is slowly beginning to change, as recent regulatory and legal initiatives designed to boost entrepreneurship and VC commitment in France are now starting to have an effect. James Brandman reports

Land of the secondary buyout

Secondary buyouts were the most popular form of exit in the French market last year, and almost half of all buyout transactions were between private equity firms. Tom Allchorne reports on a popular market that loves to recycle.

Captives and conflicts

JPMorgan’s decision in March to spin off JPMorgan Partners is confirmation for some market observers that in-house private equity operations and banks do not mix. However, other institutions remain committed to direct investing and are successfully managing the potential client conflicts and earnings volatility that captive units can entail. Joanna Hickey reports

Italy: still a family affair?

Despite ownership models with more loops than a bowl of spaghetti, major deals, new funds and increasing mid-market action continue to drive Italy’s private equity market forward. Joanna Gant reports

Can VCTs earn investor trust?

Thanks largely to government tax breaks, the last financial year marked a dramatic recovery in fund raising for UK-based venture capital trusts (VCTs) but will the influx of funds improve performance? Patrick McCurry reports

Getting yourself a reputation

There’s been plenty of talk over recent years about how branding can help fund managers with, deal origination, fund raising and staff retention. But what about LPs? Now that access to the best funds is becoming an issue in Europe, should investors be building their reputations among GPs? Vicky Meek asks

Transfer pricing ruling dismays UK private equity

The March 4 announcement on transfer pricing was a body blow to the UK private equity industry. In one fell swoop the UK Government tarred the industry with the brush of tax avoidance by stating it intended to stop interest on shareholder debt being tax deductible on all deals made after March 4, 2005. For those deals done before that date, the legislation will become effective from April 1, 2007, unless any amendments are made to the terms of the shareholder debt, such as changes to the parties, interest rate or repayment terms, other terms or conditions, in which case the rules will apply from when the changes were made. Tom Allchorne reports

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