Editor’s Note
Too much of a good thing?
A record private equity fund raising year in 2005 and greater predicted for 2006 has intensified the spotlight on the private equity asset class. In 2005 M&A activity in the UK was dominated by private equity buyers, with them making up more than 50% of the total value of transactions during the year. The importance of private equity bidders in the M&A arena is expected to grow, a trend that will be reflected across Continental Europe. Given the swollen coffers of private equity firms and their ability and appetite to bid for increasingly large companies, they are expected to do more headline-grabbing deals this year.
News analysis
Challenges ahead for AIM
AIM is the current champion of Europe’s, if not the world’s, public markets. Tom Allchorne looks at whether the good times can last.
PE recruitment: when is the right time?
The people pages of EVCJ have been crammed over the last year, with firms recruiting in anticipation of and following new fund raisings. Bowmark Capital is one of the latest on a recruitment drive looking to appoint junior level professionals to train up before the firm goes on to raise its first fund since independence in a few years’ time. This will give the new members time to get embedded in the team before the new fund gets off the ground and seems to be a popular strategy for most firms with the mindset that recruitment in private equity should be a gradual process and not just a mad rush before a fund raising. Angela Sormani reports.
Growing PE market sparks competition concerns
As the private equity market in Europe reaches record levels in terms of both fund raising and deal sizes, a rise in competition concerns is predicted as private equity portfolios become larger and businesses within these portfolios are merged to create larger animals, consequently gaining ever larger market shares. While in the past private equity deals have not tended to raise many competition concerns, the authorities are becoming increasingly aware of these deals and are being forced to look at such transactions and also the companies within the private equity firm’s portfolio more closely. Angela Sormani reports.
News highlights
Cazenove PE and Prelude to merge
BoI opens in Germany
Europe’s VCs big funders of biotech
Interregnum’s secondary sale collapses
AnaCap targets financial services
Oxford and Cambridge money race
Buyout news
UK PtPs ill fated in Q1
UK buyout market fails to impress
Seed through early stage
RisingStars Fund II reaches first close
Venturefest in its eighth year
Cambridge Consultants restarts corp venture unit
Triangle sells portfolio
Fund news
Lead story
Euro mezz attracts funds
Another record year is predicted for the European mezzanine market and alternative asset manager GSC Partners is ready to benefit from the opportunities on offer. The firm has just closed its second mega mezzanine offering with over €1bn for investment in European mezzanine transactions. Angela Sormani looks at where that money is heading.
Quick view
SEP fund launch
Schroders FoF close
Syngenta launches US$100m biotech fund
Big Bang has 1st close on €17.3m
Puma VCT III & IV raise £39m
Primary Capital raises £200m
IMAC raises £150m
Northzone closes fifth fund
Polaris closes fund
Exit news
Lead story
Legrand IPO sparks stampede
French electrical equipment manufacturer Legrand became one of the most successful private equity-backed IPOs when it floated on Euronext Paris. The offering was oversubscribed by 30x and the shares were so popular it pushed the price of the company beyond the limits allowed by the stock exchange, forcing trading to be suspended for 15 minutes.
Quick view
EXITS
Earlybird sells Identify Software
Advent sells Terapia
3i and Accent no longer in Alignment
3i sells minority stake in Fairways
Sogetrel sold in secondary buyout
Allianz sells Hansen Transmissions
Mayfair Gaming changes PE hands
Paragon passes from Duke St to HgCapital
Irish VCs exit SteelTrace
Mecatherm secondary buyout
Astorg sells RLD
Barclays PE trebles Cabot investment
Renovo float
Stroili Oro in secondary buyout
GIMV sells Food Partners
Zumtobel plans IPO
SAF IPO
ABN sells RTD
Magix IPO
Lionhead Studios sold to Microsoft Game Studios
Dataroom
Italian PE on the up
PE fund raising predictions for 2006
PE fund raising set to beat 2005
Israeli tech raises US$360m
People
Quick view
Kirkland appts
TVM promotes
SVC recruits
IFE Conseil hires
BoI opens in Germany
TA appts
Springwell renamed
Close Bros expands
Bridgepoint appts
Linklaters promotes
Lehman appts
CVC appts
Sovereign hires
Capital Dynamics reshuffle
Actis appts
DLJ recruits
HgCapital expands
BoI builds
3i promotes
ECI recruits
WPE promotes
FEATURES
Southern belles
Most of the interest in private equity activity in Southern Europe is concentrated on the Spanish and Italian markets, with Spain witnessing a significant upsurge in deals in the last year while Italy continues to under-perform considering the size of its economy. Patrick McCurry reports.
The problem with France
The strikes and riots over the new labour proposals by the French Government have made headlines around the world, painting a picture of a country confused about its role in a free market global economy. Tom Allchorne looks at whether charges of protectionism and insularity can be levelled at the private equity industry in France.
LP Talking Head
Taking a view: SVG Capital
LP Corner
Listed fund-of-funds
Like any apparently great idea, when there are only a handful of players carrying out said idea, it’s natural to wonder why more people aren’t doing it. On the face of it a listed fund-of-funds (FoF) looks like a good proposition for investors seeking both liquidity and access to private equity. Tom Allchorne looks at why there aren’t more of them.
Legal & Regulatory
China: VC regulations
Investing in privately-owned companies in China is sometimes compared to hitting a moving target not only because product and technological developments are so rapid but the markets in which those growth companies are operating can become saturated with competitors in a matter of months. Anthony O’Connor reports
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