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private equity news

Private Equity Firm: EQT

June 24, 2011

EQT is a group of leading 13 private equity funds active in buyouts, equity related growth financing and infrastructure.

The EQT funds invest in companies in Northern and Eastern Europe, Asia and the United States. The funds invest in companies where EQT act as a catalyst for change and transforming these companies into global or regional leaders.

The approach of the Equity, Expansion Capital and Infrastructure funds is to acquire or finance high-quality, market-leading, medium-sized companies in growth industries with a potential for top-line growth.

All EQT funds are advised by EQT Partners. EQT Partners has more than 190 employees in 11 countries and has offices in Copenhagen, Frankfurt, Helsinki, Hong Kong, London, Munich, New York, Oslo, Shanghai, Singapore, Stockholm, Warsaw and Zurich.

Since its establishment over the past 16 years, EQT has raised approximately EUR 13 billion (USD 18.7 billion) in 13 funds and invested and financed more than EUR 9.7 billion (USD 13.9 billion) in over 85 companies. Companies advised by EQT Partners have average annual growth of sales by 11%, the number of employees by 12% and earnings by 18%.

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State of the Private Equity Industry

July 22, 2010

Fundraising efforts for the private equity sector are up 26% in the first half of 2010 versus a year ago. Does this mean the industry is storming back to where it was before? Not so fast, says David Rubenstein, Co-Founder and Managing Director of The Carlyle Group.

Rubenstein was interviewed on-air recently by CNBC during the 6th annual Aspen Ideas Festival. He says the best opportunities in private equity are shifting to the big emerging markets of China, India and Brazil. And while there still may be deal flow in the U.S. and Western Europe, it’s not going to be as robust as before.

Carlyle, which has some $90.5 billion in assets under management and 67 different funds, is investing heavily in China. But they are shifting their focus to companies that produce products for the Chinese domestic market, as opposed to export-oriented firms. Examples include a fisheries company that sells 75% of its products domestically, and a milk producer.

Rubenstein is bullish on Africa right now, too, as an overlooked emerging market. While Africa has received a lot of attention from Middle Eastern and Asian investors (particularly China and Japan), American investors have tended to ignore it.

“You have to distinguish between the various parts of Africa,” Rubenstein said. “I think the greatest opportunity right now is probably in South Africa, then sub-Saharan Africa. Natural resources are really the dominant thing area where you’ll see growth, but as countries get wealthier, there are going to be more consumers that need financial services and telecommunications services and other kinds of products.”

It all underscores the growing globalization of the private equity industry. Not simply because the U.S. economy is in recovery mode. But because of shifting economic clout, says Rubenstein. The United States represented 48% of the world’s GDP after World War II. Today, the U.S. represents only about 22%. So increasingly, PE firms will be looking for opportunities around the world.

“Also, as Americans have taken their private equity skills to other parts of the world, indigenous private equity firms have set up and now they’re investing in these countries by themselves, without Americans being involved.”

What’s your opinion? Do you see a growing and permanent shift toward greater private equity investment overseas? Add your comments below.

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What Stock Pickers Can Learn from Private Equity Managers

April 13, 2009

Private equity as an asset class had an outstanding run from 1998 to 2006. More recently, with the bear market and the forced unwinding of highly leveraged positions, many of the big private equity firms such as Blackstone Group and Fortress and others have taken a bit of a hit.

But the reports of private equity’s demise, to paraphrase Mark Twain, are exaggerated. In an MSNBC online article written by Kristin Graham of the Motley Fool, she argues that ordinary investors could learn a thing or two about investment success from studying private equity.

For instance, unlike public companies, PE firms don’t have to report short-term results, so they can stay better focused on long-term results. A PE manager knows his exit strategy upfront, so he’s ready to act swiftly when the time comes. And PE executives’ compensation (as well as a sizeable chunk of their own holdings) are usually tied to the performance of the business.

Graham suggests that investors look for similar qualities when investing in the stocks of public companies. Such as firms with outstanding corporate governance structures like Walt Disney. Or firms with a clear long-term perspective, such as Warren Buffet’s Berkshire Hathaway. And companies that tie executive compensation clearly to performance. Sergey Brin and Larry Page of Google, for instance, take home just $1 in salary with the rest tied to performance-based incentives.

Many private equity firms have done an outstanding job at extracting value from the companies they manage. In fact, as we’ve discussed in this blog before, PE firms have a better track record at managing their companies than family-owned and government-operated firms. Graham suggests that by looking for public firms that operate in a similar way, you can get a better value out of your equity investments.

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The Brave New World for Private Equity Investors

March 30, 2009

The global economic crisis has churned up the private equity world, not only for PE firms but also for the primary investors in the asset class. A recent Wall Street Journal article looked at how a ranking of the most influential European private equity investors reveals a seismic shift in power, now that private equity [...]

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Private Equity Firms May Adapt Better to the Current Environment

March 16, 2009

Private equity may be better able to adapt to today’s tumultuous environment than other asset classes, due to the long-term nature of private equity investments and the influence that private equity managers have over entry and exit decisions. That’s the view of Peter Pfister, recently named managing director of private equity at Deutsche Bank’s Asia-Pacific [...]

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Private Equity Positioned to Lead Economic Recovery

March 9, 2009

Private equity is “smart money” that can bring the kind of sustainable and fundamental improvements companies need to pull themselves out of this financial crisis. That’s the opinion of Rami Bazzi, Senior Executive Officer at Injazat Capital Limited, a leading asset management and investment bank in Dubai, UAE. Bazzi told Emirates Business that private equity [...]

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Private Equity Firms Fare Better in Tough Times

February 23, 2009

Private equity firms are better able to make the difficult choices necessary in a downturn, such as shutting down poorly performing businesses. That’s according to a report by the World Economic Forum, as reported in the Financial Times. The report was based on a study of thousands of companies from 1980 through 2005. The report [...]

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Private Equity Industry Brushing Up Its Image

February 17, 2009

The Private Equity Council, an advocacy group made up of 13 of the largest buyout firms, is adopting a new set of guidelines for an industry tarnished by recent Wall Street excesses. The new guidelines cover environmental, health, safety, labor, governance and social issues. Among the highlights of the 9 new guidelines are industry commitments [...]

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Private Equity Jobs More Stable in Crisis

January 5, 2009

Several private-equity-backed companies have gone bankrupt or are teetering on the edge (Linens ‘N Things and Chrysler, for example). And other large PE firms such as Blackstone Group and Fortress Investment have seen their stock prices plummet in 2008. Nevertheless, compared to investment banking, relatively few people in private equity have actually lost their jobs, [...]

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Reverse Brain Drain Could Lead to a Private Equity Boom Overseas

December 18, 2008

U.S. immigration policies and the financial crisis are pushing many of the best-educated and successful minds in finance back to their home countries of India and China, reports the Globe and Mail. A new large-scale study of 1,200 Indian and Chinese returnees that’s due out next month shows the majority of those returning home have [...]

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