Private Equity Holding is to break free of its parent, Swiss private bank, Vontobel, as a result of a breakdown in trust between the two parties. Private Equity Holdings’ chief executive, Dominik Meyer and deputy Ulrich Geilinger, who were appointed in March, were both executives at the former parent.
In the light of irregularities found in a review of investments that related to the previous management of Private Equity Holding AG, the board decided to move from Vontobel to Swiss Life Private Equity Partners AG, which is the new manager and advisor for the division.
The report documented several cases of misconduct, such as transgression of competencies, negligence of duty of care, as well as incomplete documentation by the former chief executive officer, Hans-Peter Bachmann, who left Private Equity Holdings in March.
All agreements with Vontobel Group have been terminated with immediate effect, but the group will continue to work with Private Equity Holding and Swiss Life Private Equity to ensure the planned transition and new direction. Vontobel’s future involvement with the group is subject to negotiations.
“First and foremost, the whole team is still employed by Vontobel. However, what is very clear is that the board has full confidence in the management team this hasn’t been an issue for breaking away from Vontobel,” said Dominik Meyer.
The board feels there has been a breakdown of trust in the relationship as a whole due to
the problems relating back to the previous management.
Private Equity Holding’s new manager, Swiss Life Private Equity Partners is the private equity arm of Swiss Life and the exclusive advisor and manager of its initial CHF2 billion private equity investment programme. The firm pursues a diversification strategy with regard to fund participations and focuses its direct investments on growth industries. It is hoped the affiliation between the two entities will open up significant opportunities for future growth, with its broad financial service offering, its global orientation and financial strength.
Another Vontobel fund, 5E Holding, which targets private equity investments in central and eastern Europe, will also be making the switch from Vontobel to Swiss Life through a merger with Private Equity Holding. The management and board of directors for the two companies are identical. A merger proposition will be presented at the AGM on August 23.
Meyer said there would be no change of focus regarding the funds. As 5E Holding is ten times smaller than Private Equity Holdings, there will be no huge impact on asset allocation. The funds will maintain a European focus with some investments in the US and Israel.