The document is a report on global private equity investment activity in 2011. It finds that over 60% of survey respondents expect private equity investment activity to increase in the coming year, with the most optimism expressed in emerging markets like Brazil and India. Consumer sectors are cited as the most active, while strategic buyers and other private equity firms are expected to be the main sources of competition for deals globally. Caution remains highest among private equity firms in Western Europe.
Grant Thornton - Global Private Equity Report 2012 Grant Thornton
Najnowszy raport Grant Thornton pokazuje nowe kierunki rozwoju branży private equity w otoczeniu zdominowanym przez spowolnienie gospodarcze, ograniczone zaufanie do instytucji finansowych oraz nadchodzące zmiany regulacyjne (MSSF). Sektor ten pomimo stojących przed nim wyzwań, okazuje się siłą stymulującą wzrost.
A.T. Kearney: GCC Family Businesses: Unlocking Potential Through Active Portf...Semalytix
Since 2008, times have been tough for family businesses. The antidote: tapping into hidden value.
Like families in general, family businesses seem to function relatively well in troubled times. In fact, many studies show that, in the long run, they perform better than other business models. Key factors for their ongoing success include a management perspective that emphasizes the long term, strong brand and family name recognition, and often a strong focus on the core business.1
But in the Gulf Cooperation Council (GCC), family businesses are trending in the opposite direction.2 During the recent crisis, they have been less resilient than the rest of the economy despite a pre-downturn history of rapid growth and market dominance. Since 2008, the A.T. Kearney GCC Family Conglomerate Index has decreased by 60 points, while the Bloomberg GCC 200 Index has decreased by 40 points, a 20-point performance gap (see figure 1).3 After a tough 2008, GCC family businesses rebounded to some extent (as did the market), but this did not last. As the overall market has trended mostly up, family businesses have trended downward.
- See more at: http://www.atkearney.com/paper/-/asset_publisher/dVxv4Hz2h8bS/content/gcc-family-businesses-unlocking-potential-through-active-portfolio-management/10192#sthash.sb692Hgw.dpuf
1. Political, market, and investor horizons remain out of sync as debt crisis tackling will be long and volatility continues.
2. Clients will take both cautious and opportunistic approaches to risk, blending flight and fight strategies.
3. Asset managers must develop capabilities to benefit clients from volatility through dynamic strategies, manager selection, and communication.
The document discusses the changing global economic landscape and the rise of companies from rapidly developing economies (RDEs). It introduces the 2013 list of 100 global challengers - fast-growing companies from RDEs that are driving global growth and transforming industries. Some key points:
- Revenues and employment of the global challengers have grown significantly faster than S&P 500 companies in recent years.
- They represent 17 countries, up from 10 in the original 2006 list, reflecting their increasing global expansion.
- Over 30 are consumer-focused, showing the growth of consumer markets and spending in RDEs and abroad.
- Twenty-six companies are new to the list, replacing those that have fallen
This document summarizes a report that investigates "market-based solutions" to help improve the lives and livelihoods of those living in poverty globally. The report focuses on business models that have been successful in emerging markets like India.
Key findings of the report include:
1) Market-based solutions have generated significant benefits for low-income people by providing access to useful products and services.
2) For these solutions to succeed, business models must be tailored to the economic and social conditions of the poor.
3) New entrants and small enterprises are more likely than large corporations to develop successful models for low-income markets.
The report identifies seven business models that have the potential for success,
The global venture capital industry is experiencing paradigm shifts as it becomes more globalized. While the US remains dominant, Asia is growing rapidly, with China surpassing Europe in total investment amounts. Emerging markets like China and India prefer later investment stages, while more mature markets in the US and Europe invest earlier. Half of US venture capital firms now invest internationally, and globalization is expected to increase further in the coming years through cross-border investments and exits.
D2 Capital Partners: Intro To Capital Markets Careers & D2 Capital P...Ian Nguyen
D2 Capital Partners is an independent investment and advisory partnership that operates across the capital markets spectrum. It raises capital for companies, assists with deployment of capital, and structures innovative solutions. The presentation materials discuss D2 Capital's role in capital markets, careers in capital markets, and how to break into the industry, focusing on venture capital, private equity, mergers and acquisitions, and other areas.
Grant Thornton - Global Private Equity Report 2012 Grant Thornton
Najnowszy raport Grant Thornton pokazuje nowe kierunki rozwoju branży private equity w otoczeniu zdominowanym przez spowolnienie gospodarcze, ograniczone zaufanie do instytucji finansowych oraz nadchodzące zmiany regulacyjne (MSSF). Sektor ten pomimo stojących przed nim wyzwań, okazuje się siłą stymulującą wzrost.
A.T. Kearney: GCC Family Businesses: Unlocking Potential Through Active Portf...Semalytix
Since 2008, times have been tough for family businesses. The antidote: tapping into hidden value.
Like families in general, family businesses seem to function relatively well in troubled times. In fact, many studies show that, in the long run, they perform better than other business models. Key factors for their ongoing success include a management perspective that emphasizes the long term, strong brand and family name recognition, and often a strong focus on the core business.1
But in the Gulf Cooperation Council (GCC), family businesses are trending in the opposite direction.2 During the recent crisis, they have been less resilient than the rest of the economy despite a pre-downturn history of rapid growth and market dominance. Since 2008, the A.T. Kearney GCC Family Conglomerate Index has decreased by 60 points, while the Bloomberg GCC 200 Index has decreased by 40 points, a 20-point performance gap (see figure 1).3 After a tough 2008, GCC family businesses rebounded to some extent (as did the market), but this did not last. As the overall market has trended mostly up, family businesses have trended downward.
- See more at: http://www.atkearney.com/paper/-/asset_publisher/dVxv4Hz2h8bS/content/gcc-family-businesses-unlocking-potential-through-active-portfolio-management/10192#sthash.sb692Hgw.dpuf
1. Political, market, and investor horizons remain out of sync as debt crisis tackling will be long and volatility continues.
2. Clients will take both cautious and opportunistic approaches to risk, blending flight and fight strategies.
3. Asset managers must develop capabilities to benefit clients from volatility through dynamic strategies, manager selection, and communication.
The document discusses the changing global economic landscape and the rise of companies from rapidly developing economies (RDEs). It introduces the 2013 list of 100 global challengers - fast-growing companies from RDEs that are driving global growth and transforming industries. Some key points:
- Revenues and employment of the global challengers have grown significantly faster than S&P 500 companies in recent years.
- They represent 17 countries, up from 10 in the original 2006 list, reflecting their increasing global expansion.
- Over 30 are consumer-focused, showing the growth of consumer markets and spending in RDEs and abroad.
- Twenty-six companies are new to the list, replacing those that have fallen
This document summarizes a report that investigates "market-based solutions" to help improve the lives and livelihoods of those living in poverty globally. The report focuses on business models that have been successful in emerging markets like India.
Key findings of the report include:
1) Market-based solutions have generated significant benefits for low-income people by providing access to useful products and services.
2) For these solutions to succeed, business models must be tailored to the economic and social conditions of the poor.
3) New entrants and small enterprises are more likely than large corporations to develop successful models for low-income markets.
The report identifies seven business models that have the potential for success,
The global venture capital industry is experiencing paradigm shifts as it becomes more globalized. While the US remains dominant, Asia is growing rapidly, with China surpassing Europe in total investment amounts. Emerging markets like China and India prefer later investment stages, while more mature markets in the US and Europe invest earlier. Half of US venture capital firms now invest internationally, and globalization is expected to increase further in the coming years through cross-border investments and exits.
D2 Capital Partners: Intro To Capital Markets Careers & D2 Capital P...Ian Nguyen
D2 Capital Partners is an independent investment and advisory partnership that operates across the capital markets spectrum. It raises capital for companies, assists with deployment of capital, and structures innovative solutions. The presentation materials discuss D2 Capital's role in capital markets, careers in capital markets, and how to break into the industry, focusing on venture capital, private equity, mergers and acquisitions, and other areas.
Mridul arora final paper deloitte banking and financeMridul Arora
The document discusses various factors involved in pricing private equity transactions, including understanding the industry, valuation parameters, and estimating variables like EBITDA, enterprise value, and equity value. It also examines macro trends in private equity markets like growth in emerging markets and participation of investment banks and hedge funds. Pricing models focus on valuation metrics like EBITDA multiples, present value of future cash flows, and market ratios for listed companies.
Traditionally, and in the layman’s view of the word, venture is defined as high risk/high reward, early-stage investment. The model comes from Silicon Valley where the maturity of the eco-system makes early-stage a reasonably predictable activity. In Europe however, this part of the market is now left to business angels, government-subsidised funds, and a handful of the larger VCs which can afford to subsidise this largely money-losing activity to feed their larger later-stage funds. VCs have largely deserted early-stage and are now focusing their attention on expansion capital.
This chapter discusses the benefits that multinational corporations can gain from direct foreign investment. It describes common motives for MNCs to engage in DFI, including seeking new sources of demand, entering profitable markets, exploiting monopolistic advantages, reacting to trade restrictions, and diversifying internationally. The chapter also explains cost-related motives such as fully benefiting from economies of scale, using lower-cost foreign factors of production like labor and materials, and reacting to exchange rate movements. Finally, it compares the potential benefits of DFI across different countries.
Global Investing: Considerations for Building an End-to-End SolutionBroadridge
US clients are missing out on 90% of the world’s investment opportunities. Traditionally, firms have faced cost, complexity, and time-to-market hurdles when considering how to offer foreign securities to their clients. The paper defines the critical capabilities brokerage firms need to support international investing and provides best practices and a questionnaire to help design a roadmap for global expansion.
This document discusses high-growth companies and business support for them. It argues that public sector thinking has overly focused on "gazelles," or fast-growing startups, ignoring that growth is not always linear and varies by industry and business lifecycle stage. It also notes that some businesses may plateau at a certain size due to infrastructure limits. The document aims to critically re-examine models of high-growth businesses and identify sectors on Merseyside that could benefit most from accelerated support like that planned for Project EV, a business incubator. It argues Merseyside's economy relies on manufacturing and visitors and examines why some businesses face growth blockages.
Copy of Resources Conference Presentation delivered in September 2012 by Nick Assef covering various issues including Joint Ventures, Royalties, Approaches to Valuation and deal Activity in the Australian economy
This document summarizes the findings of a study on equity crowdfunding conducted by Bloomio in conjunction with IMD MBA students. The study included interviews with over 40 stakeholders in the venture capital industry as well as a survey of 741 retail investors. The key findings were:
1) Awareness of equity crowdfunding platforms is low, representing a barrier for retail investors.
2) The minimum investment amounts required for traditional venture capital are perceived as too high for many individual investors.
3) Investors with direct experience investing in startups have a higher tolerance for risk than those without experience.
4) Fear of scams is the top concern for both experienced and inexperienced investors when
The Design And Management Of InternationalIsis Quiñones
This document summarizes an academic paper on the design and management of international joint ventures. It provides background on the author and their expertise in joint ventures. It then outlines several key sections in the paper, including definitions of joint ventures, types of joint ventures, motivations for forming international joint ventures, requirements for success, and lessons learned from joint ventures. Checklists and frameworks are presented for evaluating joint venture partnerships and ensuring congruence between partners. Cultural differences that can impact joint ventures are also discussed.
Planning a Start-up? Our private equity investment PowerPoint presentation slide is just what you need. These equity-based crowdfunding PPT templates will fill the gap between the investors and your company. Download from here: https://www.slideteam.net/private-equity-investment-deck-powerpoint-presentation-slides.html
This document provides an overview and introduction to private equity. It begins with an introduction of the speaker and his background in private equity investments. It then defines private equity and discusses the two broad classes of buyouts and venture capital. Next, it provides an overview of the private equity market and landscape. It discusses fund structure and organization. Finally, it discusses various career options in private equity and provides a high-level question and answer agenda.
This document discusses building an "advantaged portfolio" at the corporate level. It defines an advantaged portfolio as having three key characteristics: being strategically sound, value-creating, and resilient.
To be strategically sound, a portfolio must be competitively positioned in attractive industries and markets where the company can win, support a balanced portfolio of innovation initiatives, and create synergies across businesses.
To be value-creating, a portfolio must maximize intrinsic value as measured by discounted cash flows, address capital market valuation to ensure market value aligns with intrinsic value over time, and maximize the portfolio's value to potential other owners.
Finally, a resilient portfolio can withstand various scenarios in its industry and builds flexibility through
The document discusses various types of corporate restructuring including mergers and acquisitions. It provides examples of different types of mergers such as horizontal, vertical, and conglomerate mergers. It also discusses reasons for mergers and acquisitions including increasing market power, overcoming barriers to entry, and lowering costs. Potential problems with mergers and acquisitions are outlined like integration difficulties, inadequate evaluation of targets, and managers becoming overly focused on acquisitions.
This document contains best practices for mergers and acquisitions (M&A) from deal planning through post-merger integration. It discusses defining clear goals for acquisitions, ensuring cultural and strategic fit, conducting thorough due diligence, managing people and communication issues, and treating integration as a project. Key recommendations include being realistic about synergies, having devil's advocate reviews, planning for talent retention, and differentiating aspects to integrate quickly versus slowly. The best practices are meant to increase the likelihood of M&A deal success.
Mergers and acquisitions (M&As) allow companies to gain competitive advantages such as economies of scale, increased market share, and access to new customers and technologies. The document discusses the objectives and strategies of M&As, including international trends in M&A activity over the last century. There have been five major waves of M&A activity driven by factors like industry consolidation, globalization, and economic conditions. Currently, healthy corporate balance sheets, low interest rates, and growing M&A activity in emerging markets are fueling a new wave of cross-border M&As.
Nuestra visión del mundo de inversión en tecnología - Colombia Investment Sum...ProColombia
This document discusses SoftBank's vision for technology investment in Latin America. It makes the following key points:
1) Latin America has significant potential for technology growth and adoption due to its large population and GDP, which are on par with countries like China and India. However, technology penetration remains in the early stages.
2) Venture capital investment in Latin America has been growing exponentially and is expected to continue rising as technology adoption increases across industries.
3) SoftBank believes Latin America is one of the most promising regions in the world for technology investment due to the rapid growth of technologies like e-commerce, digital payments, and streaming services in the large consumer market.
This white paper discusses developing a strategy to grow shareholder wealth. It identifies the four primary drivers of organizational value as profitability, productivity, cash flow, and strategic growth. The paper focuses on differentiation, which is improving returns in an existing market rather than diversification into new markets. It discusses positioning products in terms of degree of differentiation and cost leadership to maximize both margin and sales volume. Productivity is also key and is measured by the input-output ratio of a company's assets. The overall strategy presented is to understand markets, customer demand, and how to improve return on capital employed through differentiation, profitability and productivity.
Company X is seeking funding to commercialize and market a patented widget process that increases effectiveness by 60% and decreases costs by 40% compared to existing solutions. The technology platform utilizes a patented process that drives faster, better, and cheaper products and services while being backward compatible with legacy systems. An analysis of the target market identified approximately 120 potential customer companies with annual widget purchases between $1-12 million per company, representing a billion dollar market opportunity for growth.
Private Equity Firms See Agriculture, Education, Renewable Energy and Services as Hottest Asian Investments for 2010 and beyond.
Private Equity (PE) leaders in Asia may differ in their growth expectations for 2010 and beyond, but they all agree that PE Investments will shift from traditionally attractive sectors such as Information Technology, Consumer and Retail, Financial Services and Real Estate. What are the fundamentals driving this trend and what strategies will PE firms pursue?
This presentation shows selected slides from a GIA white paper. To download the entire white paper that you are interested in, please visit http://bit.ly/GIAinsightWP
The report discusses the imperative for companies to achieve sustainable value creation in today's uncertain economic environment. Sustainable value creation is characterized by:
1) Distinctive customer value and competitive advantage that allows above-average shareholder returns over the long term.
2) Consistency in beating the market average in more years than not.
3) Balance between short-term performance, long-term performance, and the interests of all stakeholders.
Sustainable value creation is difficult to achieve, as few companies beat their market average for more than five out of ten years. The report will examine pathways for companies to create sustainable value.
Este documento describe un taller práctico sobre 10 claves para la implementación de tendencias y enfoques innovadores en la enseñanza. El taller tiene como objetivo ayudar a los docentes a identificar cambios necesarios para incorporar las tecnologías de la información y la comunicación en el aula y currículo. El taller explora nuevas habilidades, estrategias y competencias para los docentes y propone 10 claves esenciales para la innovación educativa como la implementación de tecnología, capacitación docente y reconfiguración del currículo.
Na odpowiednio przeprowadzoną sukcesję ma wpływ długotrwały proces planowania, jak i odpowiednie przygotowanie sukcesora. Eksperci z Grant Thornton pomogą podjąć odpowiednią decyzję w sprawie przyszłości firmy, jak i zrealizować cały proces sukcesji.
Mridul arora final paper deloitte banking and financeMridul Arora
The document discusses various factors involved in pricing private equity transactions, including understanding the industry, valuation parameters, and estimating variables like EBITDA, enterprise value, and equity value. It also examines macro trends in private equity markets like growth in emerging markets and participation of investment banks and hedge funds. Pricing models focus on valuation metrics like EBITDA multiples, present value of future cash flows, and market ratios for listed companies.
Traditionally, and in the layman’s view of the word, venture is defined as high risk/high reward, early-stage investment. The model comes from Silicon Valley where the maturity of the eco-system makes early-stage a reasonably predictable activity. In Europe however, this part of the market is now left to business angels, government-subsidised funds, and a handful of the larger VCs which can afford to subsidise this largely money-losing activity to feed their larger later-stage funds. VCs have largely deserted early-stage and are now focusing their attention on expansion capital.
This chapter discusses the benefits that multinational corporations can gain from direct foreign investment. It describes common motives for MNCs to engage in DFI, including seeking new sources of demand, entering profitable markets, exploiting monopolistic advantages, reacting to trade restrictions, and diversifying internationally. The chapter also explains cost-related motives such as fully benefiting from economies of scale, using lower-cost foreign factors of production like labor and materials, and reacting to exchange rate movements. Finally, it compares the potential benefits of DFI across different countries.
Global Investing: Considerations for Building an End-to-End SolutionBroadridge
US clients are missing out on 90% of the world’s investment opportunities. Traditionally, firms have faced cost, complexity, and time-to-market hurdles when considering how to offer foreign securities to their clients. The paper defines the critical capabilities brokerage firms need to support international investing and provides best practices and a questionnaire to help design a roadmap for global expansion.
This document discusses high-growth companies and business support for them. It argues that public sector thinking has overly focused on "gazelles," or fast-growing startups, ignoring that growth is not always linear and varies by industry and business lifecycle stage. It also notes that some businesses may plateau at a certain size due to infrastructure limits. The document aims to critically re-examine models of high-growth businesses and identify sectors on Merseyside that could benefit most from accelerated support like that planned for Project EV, a business incubator. It argues Merseyside's economy relies on manufacturing and visitors and examines why some businesses face growth blockages.
Copy of Resources Conference Presentation delivered in September 2012 by Nick Assef covering various issues including Joint Ventures, Royalties, Approaches to Valuation and deal Activity in the Australian economy
This document summarizes the findings of a study on equity crowdfunding conducted by Bloomio in conjunction with IMD MBA students. The study included interviews with over 40 stakeholders in the venture capital industry as well as a survey of 741 retail investors. The key findings were:
1) Awareness of equity crowdfunding platforms is low, representing a barrier for retail investors.
2) The minimum investment amounts required for traditional venture capital are perceived as too high for many individual investors.
3) Investors with direct experience investing in startups have a higher tolerance for risk than those without experience.
4) Fear of scams is the top concern for both experienced and inexperienced investors when
The Design And Management Of InternationalIsis Quiñones
This document summarizes an academic paper on the design and management of international joint ventures. It provides background on the author and their expertise in joint ventures. It then outlines several key sections in the paper, including definitions of joint ventures, types of joint ventures, motivations for forming international joint ventures, requirements for success, and lessons learned from joint ventures. Checklists and frameworks are presented for evaluating joint venture partnerships and ensuring congruence between partners. Cultural differences that can impact joint ventures are also discussed.
Planning a Start-up? Our private equity investment PowerPoint presentation slide is just what you need. These equity-based crowdfunding PPT templates will fill the gap between the investors and your company. Download from here: https://www.slideteam.net/private-equity-investment-deck-powerpoint-presentation-slides.html
This document provides an overview and introduction to private equity. It begins with an introduction of the speaker and his background in private equity investments. It then defines private equity and discusses the two broad classes of buyouts and venture capital. Next, it provides an overview of the private equity market and landscape. It discusses fund structure and organization. Finally, it discusses various career options in private equity and provides a high-level question and answer agenda.
This document discusses building an "advantaged portfolio" at the corporate level. It defines an advantaged portfolio as having three key characteristics: being strategically sound, value-creating, and resilient.
To be strategically sound, a portfolio must be competitively positioned in attractive industries and markets where the company can win, support a balanced portfolio of innovation initiatives, and create synergies across businesses.
To be value-creating, a portfolio must maximize intrinsic value as measured by discounted cash flows, address capital market valuation to ensure market value aligns with intrinsic value over time, and maximize the portfolio's value to potential other owners.
Finally, a resilient portfolio can withstand various scenarios in its industry and builds flexibility through
The document discusses various types of corporate restructuring including mergers and acquisitions. It provides examples of different types of mergers such as horizontal, vertical, and conglomerate mergers. It also discusses reasons for mergers and acquisitions including increasing market power, overcoming barriers to entry, and lowering costs. Potential problems with mergers and acquisitions are outlined like integration difficulties, inadequate evaluation of targets, and managers becoming overly focused on acquisitions.
This document contains best practices for mergers and acquisitions (M&A) from deal planning through post-merger integration. It discusses defining clear goals for acquisitions, ensuring cultural and strategic fit, conducting thorough due diligence, managing people and communication issues, and treating integration as a project. Key recommendations include being realistic about synergies, having devil's advocate reviews, planning for talent retention, and differentiating aspects to integrate quickly versus slowly. The best practices are meant to increase the likelihood of M&A deal success.
Mergers and acquisitions (M&As) allow companies to gain competitive advantages such as economies of scale, increased market share, and access to new customers and technologies. The document discusses the objectives and strategies of M&As, including international trends in M&A activity over the last century. There have been five major waves of M&A activity driven by factors like industry consolidation, globalization, and economic conditions. Currently, healthy corporate balance sheets, low interest rates, and growing M&A activity in emerging markets are fueling a new wave of cross-border M&As.
Nuestra visión del mundo de inversión en tecnología - Colombia Investment Sum...ProColombia
This document discusses SoftBank's vision for technology investment in Latin America. It makes the following key points:
1) Latin America has significant potential for technology growth and adoption due to its large population and GDP, which are on par with countries like China and India. However, technology penetration remains in the early stages.
2) Venture capital investment in Latin America has been growing exponentially and is expected to continue rising as technology adoption increases across industries.
3) SoftBank believes Latin America is one of the most promising regions in the world for technology investment due to the rapid growth of technologies like e-commerce, digital payments, and streaming services in the large consumer market.
This white paper discusses developing a strategy to grow shareholder wealth. It identifies the four primary drivers of organizational value as profitability, productivity, cash flow, and strategic growth. The paper focuses on differentiation, which is improving returns in an existing market rather than diversification into new markets. It discusses positioning products in terms of degree of differentiation and cost leadership to maximize both margin and sales volume. Productivity is also key and is measured by the input-output ratio of a company's assets. The overall strategy presented is to understand markets, customer demand, and how to improve return on capital employed through differentiation, profitability and productivity.
Company X is seeking funding to commercialize and market a patented widget process that increases effectiveness by 60% and decreases costs by 40% compared to existing solutions. The technology platform utilizes a patented process that drives faster, better, and cheaper products and services while being backward compatible with legacy systems. An analysis of the target market identified approximately 120 potential customer companies with annual widget purchases between $1-12 million per company, representing a billion dollar market opportunity for growth.
Private Equity Firms See Agriculture, Education, Renewable Energy and Services as Hottest Asian Investments for 2010 and beyond.
Private Equity (PE) leaders in Asia may differ in their growth expectations for 2010 and beyond, but they all agree that PE Investments will shift from traditionally attractive sectors such as Information Technology, Consumer and Retail, Financial Services and Real Estate. What are the fundamentals driving this trend and what strategies will PE firms pursue?
This presentation shows selected slides from a GIA white paper. To download the entire white paper that you are interested in, please visit http://bit.ly/GIAinsightWP
The report discusses the imperative for companies to achieve sustainable value creation in today's uncertain economic environment. Sustainable value creation is characterized by:
1) Distinctive customer value and competitive advantage that allows above-average shareholder returns over the long term.
2) Consistency in beating the market average in more years than not.
3) Balance between short-term performance, long-term performance, and the interests of all stakeholders.
Sustainable value creation is difficult to achieve, as few companies beat their market average for more than five out of ten years. The report will examine pathways for companies to create sustainable value.
Este documento describe un taller práctico sobre 10 claves para la implementación de tendencias y enfoques innovadores en la enseñanza. El taller tiene como objetivo ayudar a los docentes a identificar cambios necesarios para incorporar las tecnologías de la información y la comunicación en el aula y currículo. El taller explora nuevas habilidades, estrategias y competencias para los docentes y propone 10 claves esenciales para la innovación educativa como la implementación de tecnología, capacitación docente y reconfiguración del currículo.
Na odpowiednio przeprowadzoną sukcesję ma wpływ długotrwały proces planowania, jak i odpowiednie przygotowanie sukcesora. Eksperci z Grant Thornton pomogą podjąć odpowiednią decyzję w sprawie przyszłości firmy, jak i zrealizować cały proces sukcesji.
This document discusses advanced data visualization (ADV) and provides strategies for implementing effective ADV solutions. It outlines seven primary capabilities of ADV solutions, including dynamic data, visual interfaces, multidimensional analysis, and proactive alerts. It also describes methodologies like storyboarding and prototyping to enable ADV. Key benefits of ADV include improved operational efficiency, faster insight from data, and enabling users to create their own visualizations.
Don't Waste Your Time: Secrets of Minimum Viable PrototypingPhilip Likens
The document discusses secrets of minimum viable prototyping based on a presentation given at the Big (D)esign Conference 2015. It outlines 13 secrets which are: 1) Make the one thing that matters high fidelity, 2) Pick methods based on outcome, and 3) Working code wins. The secrets advise on choosing the right type of prototype, building only what is needed, applying rigor appropriately, ensuring the vision and design are correct, and designing based on constraints like platform and size.
Our 2015 Financial Executive Compensation Survey with the Financial Executives Research Foundation—This survey examines the growth in executive salary both in the public and private sectors as well gives an exclusive look into the salaries of financial executives across the US.
Switching gears in the rapidly evolving banking industry: A discussionGrant Thornton LLP
The banking industry has steadily improved over the past few years as consumers are borrowing more and banks have tightened costs. Asset quality is also improving with past-due loans and charge-offs decreasing. However, margins remain squeezed so banks are looking for ways to increase profitability such as cost-saving measures and increased automation. Regulators have increased their focus on consumer protection and are more heavily regulating non-bank lenders, debt collectors, and prepaid cards. Multiple bank mergers have been delayed due to compliance issues, so banks must ensure their compliance processes are in order if pursuing M&A.
International Business Report: How U.S. manufacturing, retail stack upGrant Thornton LLP
The latest Grant Thornton International Business Report (IBR) shows an overall optimistic view of the U.S. economy. But a closer look at two of the country’s iconic industries reveals a different story. A poster child for America’s economic rebound, manufacturing basks in a positive outlook and robust demand. Meanwhile, retail struggles under the weight of its brick-and-mortar legacy and fickle consumers. This infographic compares manufacturing and retail data from the IBR report and captures two different views of the near-term economic future. More at http://gt-us.co/1nTFsGC
Regulations, staffing keep energy executives on their toesGrant Thornton LLP
This document summarizes the results of a 2014 survey of 564 executives from U.S. oil and gas companies. The top three operational barriers to growth cited were regulatory uncertainty, staffing challenges, and infrastructure issues. Respondents expected to increase hiring and capital spending in 2015 but were concerned about regulatory complexity, safety risks, and a competitive acquisition environment. The survey aimed to understand pain points currently facing the American energy sector.
Crap! It doesn't look quite right, or, how I learned to stop worrying and set...Lyza Gardner
From Over the Air, 2011, Bletchley Park, UK.
The mobile web—or whatever we want to call it—is still in its Wild West phase, crazy, chaotic and exciting. Right now, being successful on the web is getting more complicated, to the point that it can feel impossible to succeed.
We can’t fix everything right now, but by
thinking in a future-friendly manner and
relinquishing control we never had in the first place, we can help shape the future of the web.
Compliance program requirements for the Volcker Rule of the Dodd-Frank ActGrant Thornton LLP
This document outlines the requirements for compliance programs related to proprietary trading activities. It discusses the standard elements required for all compliance programs, including governance, policies and procedures, a system of controls, recordkeeping, training, and independent testing. For enhanced compliance programs, it specifies additional requirements such as separately documenting permissible market-making and hedging activities for each trading desk, quantitative risk measurements, limits on authorized risks and instruments, hedging policies, and procedures for investigating and remediating any violations. Banking entities with over $50 billion in assets but less than $10 billion in trading assets would be subject to the enhanced compliance program requirements without reporting quantitative metrics.
CAEs speak out: Cybersecurity seen as key threat to growthGrant Thornton LLP
Financial services CAEs see cybersecurity as the top threat to growth, with 71% ranking it as the issue most likely to significantly impact their organizations' strategies. While concerns about regulatory risks have decreased slightly, cybersecurity risks are amplified by increased use of mobile technology and third-party relationships. CAEs indicate that cybersecurity must be addressed on an enterprise-wide basis due to operational, regulatory, and reputational risks. Optimizing compliance activities, improving talent quality, and effectively using data analytics and GRC tools are keys to enhancing risk management and delivering greater value.
Treasury notice creates need for caution for companies contemplating inversionsGrant Thornton LLP
Treasury notice creates need for caution.
The Treasury Department’s recent rules try to make tax inversions less financially attractive, so companies need to analyze whether the deals are still worth pursuing. Read more about inversions: http://gt-us.co/1oH7qCg
Blend instinct and solid data for overseas investment decisions Grant Thornton LLP
Soft power and instinct are driving overseas real estate investments, say the specialists interviewed and data analyzed for Grant Thornton International Ltd’s new report, Uncovering Opportunities for Overseas Investment and Growth. However, relying on instinct alone — without the assistance of hard evidence and on-the-ground advice — can lead investors away from emerging areas of opportunity.
For effective governance, boards must set a stronger toneGrant Thornton LLP
The document discusses several key issues facing not-for-profit boards and governance in 2015. It states that boards must take a stronger role in fundraising and setting the tone for ethical standards and practices. Effective boards require strong leadership from both the board chair and CEO. Boards are also recognizing the importance of diversity and seeking members with a variety of skills and backgrounds. Taking ethics beyond basic compliance, boards must model high standards of conduct to set the right tone from the top down.
This document discusses the 3.8% net investment income tax (NII tax) that applies to individuals with incomes over certain thresholds. It applies to investment income including capital gains, dividends, rents and royalties. There are some exceptions, including income from non-passive business activities. The thresholds for the tax are $200,000 for single filers and $250,000 for joint filers. Planning opportunities discussed include structuring business activities to avoid passive characterization of income, and gifting assets to children to avoid the tax. The document recommends keeping detailed records of participation in business activities to document material participation.
Compliance implications of crossing the $10 billion asset thresholdGrant Thornton LLP
Since the passage of the Dodd-Frank Act, small regional banks have been forced to rethink their growth strategies as they inch closer to the $10 billion assets threshold. Here’s guidance on navigating the new regulatory field.
For digital media companies, effective cybersecurity programs a mustGrant Thornton LLP
In digital media trust is everything, without it your business model doesn’t work. Cybersecurity can be a key component, ensuring the integrity of your services. Check out this brief guide to securing your data.
Feeling pressure to build revenues, many banks are turning to new products. It's up to boards and management to drive the risk mitigation planning process.
FASB changes to the nonprofit financial reporting modelGrant Thornton LLP
Better understand the proposed FASB Standard, which we believe will ultimately become the prevailing standard to which all nonprofits must align their reporting.
This document summarizes a study on private equity approaches in sub-Saharan Africa. It conducted interviews with 43 stakeholders in the African private equity industry. It finds that while interest in investing in Africa is rising, challenges remain around fundraising, deal flow, and talent. Private equity firms are addressing these challenges through innovative strategies. They are specializing in industry niches, finding new sources of patient capital beyond traditional investors, and providing value-add to deals beyond just capital through networks and expertise. Overall, the private equity industry in Africa is becoming more sophisticated but deal making remains challenging compared to more developed markets.
Extract of White Paper Summaries, Dec 2008 - Sept 2010keatingcapital
An extract of our white papers, including: Direct Listings: A More Certain Path to NASDAQ; Aftermarket Support: How to Create a Liquid Public Stock; Why Go Public: the $100 Million Question; The Yale Endowment Model of Investing is Not Dead; Mining the Gems in Private Equity; True Alpha - Does it Exist?
Innovating in a world where winner takes allKevin Pleiter
1) Asset managers are improving their innovation processes since the 2008 financial crisis, trying to emulate tools from dynamic companies like Apple and Toyota to better meet client needs.
2) A survey found that while asset managers are good at generating new ideas, they are not as strong at developing them through the innovation process. Most rate their innovation processes as average or below.
3) Asset managers are working to improve innovation through greater client engagement, collaboration across organizations, and digitizing processes to promote idea sharing and development.
Mergers & Acquisitions are often used as part of a
company's globalization strategy, for both intra-regional and international deals. However, substantial number of them fail. Read more to find out the challenges or visit us at: http://www.verityconsult.com
Private equity firms raised $531 billion in new funds in 2016, consistent with 2015 levels. However, fundraising varied by region, with Europe seeing a 28% increase to $159 billion while the US declined 5% to $306 billion and Asia declined 22% to $66 billion. Despite record levels of dry powder, PE firms face challenges deploying capital at attractive valuations given still elevated prices. As a result, many firms are pursuing opportunistic strategies and moving into smaller deals while waiting for a broader market adjustment.
FMA of NH: Preparing for a Successful Liquidity Eventtravismd
The document summarizes key points from a panel discussion on preparing companies for liquidity events like initial public offerings (IPOs) or mergers and acquisitions (M&As) in volatile markets. It notes that the IPO market is closed, M&A activity and valuations are down, but deals can still occur. It recommends focusing on fundamentals, building relationships, and being flexible on deal structure and type of buyers to facilitate liquidity in this environment.
1) Now is a good time for Indian companies with strong balance sheets to pursue acquisitions as valuations are low and opportunities exist to strengthen core businesses and expand into new markets.
2) Acquisitions should not be made solely based on low valuations; strategic fit in terms of technology, skills, and market penetration is important.
3) Recessions provide opportunities to acquire businesses at reasonable valuations and integrate them while their owners are open to pragmatic exits based on performance rather than high pricing multiples.
Successful companies in high-growth markets excel in three areas: sizing the future by accurately assessing market opportunities across time horizons; shaping the future by cultivating new demand; and seizing the future through operational agility. To develop these capabilities, companies should conduct global demand forecasting, experiment with new customer segments, build local partnerships, innovate to meet unmet needs, and develop agile operations. This will allow companies to open new windows of opportunity in emerging markets and compete effectively for future growth.
This document discusses strategies for companies to pursue growth opportunities in emerging markets. It finds that while executives see growth potential, many lack confidence in their ability to capitalize on these opportunities. Successful companies excel at sizing future demand, shaping new demand, and operating with agility. The document provides recommendations for building capabilities in market assessment, partnership, innovation, and speed of operations to accelerate growth efforts in high-potential emerging markets.
The work is aimed primarily at ‘new to Africa’ actors/investors interested in sub-Saharan Africa rather than the larger scale, established classic LBO market in South Africa and elsewhere around the globe, hence the theme: “In the Shadow of the Giants". It is based on opinions of stakeholders in the industry to create an overview and facilitate a better understanding of the challenges they face and the innovative approaches to the business model that have been made to deal with them.
Innovative Approaches along the Private Equity Value Chain in Sub-Sahara Africaasafeiran
This document discusses private equity in sub-Saharan Africa. It conducted interviews with 43 stakeholders in the African private equity ecosystem to understand challenges and innovative approaches. The key challenges identified are high costs of operating due to fragmented markets and lack of infrastructure/talent, difficulties with fundraising due to reliance on development finance institutions previously, and limited deal flow due to the nascent industry and lack of "investment ready" companies. However, private equity firms have found innovative solutions along the investment value chain, such as specializing in niches, accessing new sources of capital, creating platforms for regional growth, and developing local talent. Overall, while the industry is growing more competitive, opportunities remain for firms that can operate effectively on the ground in Africa
The document discusses the challenges private equity firms face in "buying well" in today's competitive market environment. It notes that high entry multiples, an abundance of dry powder, and increased competition from other buyers have made it difficult to find attractive deals. Private equity firms must focus on developing sector expertise, building relationships, and having a robust value creation plan to succeed in this environment where simple multiple arbitrage is no longer sufficient. Management issues are also a primary reason why deals fall apart after due diligence.
Sustainability issues are increasingly being factored into IPO planning and disclosures. More companies addressing sustainability risks and opportunities in SEC filings. Growing investor interest in environmental, social and governance issues leads companies to consider sustainability as part of overall business strategy and risk management.
A perspective devoted to Private Equity firms: to be successful they should adopt an innovative business model and control the richest parts of the value chain
DealMarket DIGEST Issue 116 // 08 November 2013CAR FOR YOU
This weekly digest provides summaries of recent private equity news items:
1) KKR is teaming with Kuwait Petroleum Corp to bid up to EUR 5 billion for RWE's German oil and gas unit DEA.
2) A new study finds that specialist funds and those demonstrating value-add are in high demand, and that large asset managers may replace investment banks in some product lines within a decade.
3) A report shows that US public pension funds have achieved 10% annualized returns from private equity over 10 years, higher than any other asset class. The top performing funds were located in Massachusetts, Los Angeles, and Texas.
4) Global M&A activity in the insurance
DealMarket Digest Issue116 - 8th November 2013Urs Haeusler
- PE Eyes Multi-billion Investment in German-owned Oil & Gas Unit
- New Study Reveals Emerging PE Trends and a Major Shift
- PE Outperformance: Insight into Returns at Top US Pension Funds
- Insurance Industry M&A Trends Downwards: A Global Multi Year View
- PE Industry Sees Recovery But Increasing Competition
- Quote of the Week: Seismic Strategy Shifts
This document summarizes research on understanding changing consumer behavior and how businesses can capitalize on opportunities from those changes to energize global growth. Key points:
- Consumers are changing in networked, independent, communal, conscientious, and minimalist ways that impact how and why they consume.
- Businesses must understand these "how" and "why" dimensions to meet high expectations for growth, not just focus on "where" and "who".
- Industries associated with changing behaviors like experiences and sustainability are growing much faster than overall economies.
- "Industry growth leaders" develop advanced analytics, adaptive mindsets, and agile organizations to stay close to consumers and respond quickly to changes
Bain & Company is the leading advisor to the private equity industry. While it is separate from Bain Capital, it maintains a global network of over 400 professionals serving PE clients. Bain & Company advises on half of all large buyout transactions globally and works with PE firms on the full range of their activities from deal generation and due diligence to value creation and exits. The PE market saw strong initial activity in 2011 but then slowed significantly in the summer due to economic concerns in Europe and the US, leading to a difficult year overall with dealmaking, exits, fundraising, and returns all facing challenges.
The document summarizes private markets fundraising trends in 2017. Some key points:
- Private markets fundraising reached a record $750 billion globally in 2017, driven primarily by a surge in US buyout megafunds (funds over $5 billion).
- US buyout megafunds raised $173.7 billion in 2017, a 93% increase from 2016. This surge accounted for most of the overall private markets fundraising growth.
- Investors continue to allocate heavily to private markets like private equity due to the potential for higher returns compared to public markets. Pension funds and sovereign wealth funds see private markets as a way to address underfunding issues and volatility.
Produkcja prawa zwolniła, ale nadal przytłacza firmyGrant Thornton
W 2017 r. w życie weszło 27,1 tys. stron nowych aktów prawnych, czyli o 15 proc. mniej niż rok wcześniej. Na tym jednak dobre wiadomości się kończą – wynika z raportu Grant Thornton.
Stabilność prawa to jeden z warunków długotrwałego rozwoju gospodarczego. Nadmierna zmienność regulacji nie tylko utrudnia firmom działalność, naraża je na kary i grzywny, ale też zniechęca przedsiębiorców do podejmowania inwestycji. Żeby mierzyć skalę zmienności prawa, uruchomiliśmy trzy lata temu swój „Barometr otoczenia prawnego w polskiej gospodarce”, czyli projekt badawczy, który na konkretnych liczbach pokazuje, jak dużo prawa produkuje się w Polsce w danym okresie.
10 najważniejszych zmian w podatkach ostatnich dwóch latGrant Thornton
Ranking najważniejszych z punktu widzenia podatnika zmian w przepisach podatkowych, które weszły w życie przez pierwsze dwa lata obecnej kadencji rządu
Polskie firmy nie chcą rozwijać nowych produktów Grant Thornton
Firma, aby się rozwijać, musi stale wprowadzać na rynek nowe produkty i usługi. W innym wypadku zostanie wyprzedzona przez bardziej dynamiczną konkurencję.
Jak pod tym względem wypadają obecnie polskie firmy? Zapraszamy do zapoznania się z wynikami badania przeprowadzonego przez Grant Thornton wśród średnich i dużych przedsiębiorstw z 33 krajów świata
Z przyjemnością prezentujemy kolejną edycję „Purpurowego Informatora”, czyli cyklu analiz, w którym omawiamy ważne dla przedsiębiorców kwestie prawne, księgowe i kadrowe.
Tym razem tematem naszego cyklu jest Jednolity Plik Kontrolny (JPK). Co to jest? Do czego służy? Jacy podatnicy mają obowiązek przekazywania JPK? Odpowiedzi na te i inne pytania znajdą Państwo w poniższym materiale.
The document provides guidance on applying the new IFRS 15 revenue recognition standard to companies in the real estate and construction industries. It discusses the five steps in IFRS 15's control-based model for recognizing revenue: 1) identifying contracts with customers, 2) identifying performance obligations, 3) determining transaction price, 4) allocating price to obligations, and 5) recognizing revenue. Key impacts include changes to the criteria for over time vs. point in time revenue recognition and expanded disclosures. Real estate companies will need to evaluate contracts carefully under the new standard.
Zmiany w przepisach o ochronie danych osobowychGrant Thornton
W maju 2018 roku zacznie obowiązywać unijne rozporządzenie o ochronie danych osobowych. Nowe przepisy będą dotyczyć wszystkich podmiotów, które na terenie UE przetwarzają dane w sposób zautomatyzowany. Warto zapoznać się z najważniejszymi zmianami zachodzącymi w rozporządzeniu i rozpocząć przygotowania już teraz.
Poland sustains good climate for international businessGrant Thornton
- The survey found that Poland has sustained a good investment climate and most foreign investors would choose to invest in Poland again if given the opportunity.
- Investors gave Poland an average rating of 3.72 out of 5 for its investment climate, the highest rating in the survey's 10-year history.
- While investors view factors like market size, economic stability and human resources positively, they see areas like legal stability and predictability, tax regulations, and the court system as opportunities for improvement.
Rekordowe wyniki rynku Catalyst w 2016 rokuGrant Thornton
Wartość nieskarbowych instrumentów dłużnych notowanych na Catalyst osiągnęła na koniec czwartego kwartału 2016 roku 81,8 mld zł, co było najwyższym wynikiem od momentu powstania rynku Catalyst – wynika z przygotowanego przez nas raportu pod patronatem Giełdy Papierów Wartościowych w Warszawie.
Festiwalowe szaleństwo na studencką kieszeńGrant Thornton
Średni koszt wyjazdu na festiwal muzyczny latem 2017 r. to 1530,04 zł – wynika z naszego raportu. Spośród największych europejskich festiwali najtaniej spędzisz czas na Coulors of Ostrava. Najbardziej ceną kuszą jednak polskie imprezy, zwłaszcza Przystanek Woodstock.
Grant Thornton’s transactional teams advised on a number of high profile deals throughout Europe in 2016, driving strong outcomes through highly experienced and internationally connected professionals. Grant Thornton’s success was reflected in the number two position (by average deal value) in the ranking of the top ten M&A advisors in Europe.
Z przyjemnością prezentujemy kolejną edycję „Purpurowego Informatora”, czyli cyklu analiz, w którym omawiamy ważne dla przedsiębiorców kwestie prawne, księgowe i kadrowe. Tym razem tematem naszego cyklu jest pakiet zmian w ustawie o rachunkowości, które obowiązują od 2016 roku.
Wpływy transferowe klubów piłkarskiej Ekstraklasy osiągnęły w sezonie 2016/2017 wartość 33,5 mln EUR – wynika z Grant Thornton. To najlepszy wynik w historii.
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Event Report - SAP Sapphire 2024 Orlando - lots of innovation and old challengesHolger Mueller
Holger Mueller of Constellation Research shares his key takeaways from SAP's Sapphire confernece, held in Orlando, June 3rd till 5th 2024, in the Orange Convention Center.
Tata Group Dials Taiwan for Its Chipmaking Ambition in Gujarat’s DholeraAvirahi City Dholera
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The Evolution and Impact of OTT Platforms: A Deep Dive into the Future of Ent...ABHILASH DUTTA
This presentation provides a thorough examination of Over-the-Top (OTT) platforms, focusing on their development and substantial influence on the entertainment industry, with a particular emphasis on the Indian market.We begin with an introduction to OTT platforms, defining them as streaming services that deliver content directly over the internet, bypassing traditional broadcast channels. These platforms offer a variety of content, including movies, TV shows, and original productions, allowing users to access content on-demand across multiple devices.The historical context covers the early days of streaming, starting with Netflix's inception in 1997 as a DVD rental service and its transition to streaming in 2007. The presentation also highlights India's television journey, from the launch of Doordarshan in 1959 to the introduction of Direct-to-Home (DTH) satellite television in 2000, which expanded viewing choices and set the stage for the rise of OTT platforms like Big Flix, Ditto TV, Sony LIV, Hotstar, and Netflix. The business models of OTT platforms are explored in detail. Subscription Video on Demand (SVOD) models, exemplified by Netflix and Amazon Prime Video, offer unlimited content access for a monthly fee. Transactional Video on Demand (TVOD) models, like iTunes and Sky Box Office, allow users to pay for individual pieces of content. Advertising-Based Video on Demand (AVOD) models, such as YouTube and Facebook Watch, provide free content supported by advertisements. Hybrid models combine elements of SVOD and AVOD, offering flexibility to cater to diverse audience preferences.
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The impact of OTT platforms on the Bollywood film industry is significant. The competition for viewers has led to a decrease in cinema ticket sales, affecting the revenue of Bollywood films that traditionally rely on theatrical releases. Additionally, OTT platforms now pay less for film rights due to the uncertain success of films in cinemas.
Looking ahead, the future of OTT in India appears promising. The market is expected to grow by 20% annually, reaching a value of ₹1200 billion by the end of the decade. The increasing availability of affordable smartphones and internet access will drive this growth, making OTT platforms a primary source of entertainment for many viewers.
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2. Contents
01 Key findings
04 Global picture
15 Western Europe
24 North America
33 Asia Pac
41 MENA
50 BRICS
62 Sample and methodology
64 Grant Thornton capabilities
IBC Grant Thornton contacts
Glossary
AFIC Association Française des Investisseurs en Capital (the French Private Equity Association)
AIFMD Alternative Investment Fund Managers Directive
Asia Pac Asia Pacific region
BRICS Brazil, Russia, India, China and South Africa
CEO Chief Executive Officer
DD Due diligence
ESG Environmental, social and governance
FMCG Fast moving consumer goods
GCC Gulf Cooperation Council
GDP Gross domestic product
GP General partner
HR Human resources
ILPA The Institutional Limited Partners Association
IPO Initial public offering
IR Investor relations
IT Information technology
LATAM Latin America
LP Limited partner
M&A Mergers and acquisitions
MENA Middle East and North Africa (including Turkey)
N/A Not applicable
PE Private equity
PIPE Private investment in public equity
PLC Public limited company
SME Small and medium sized enterprises
SWF Sovereign wealth fund
TMT Telecommunications, media and technology
UN PRI The United Nations-backed Principles for Responsible Investment Initiative
The views and opinions in this report expressed by those private equity survey respondents providing comments or quotes
are theirs alone, and do not necessarily reflect the views and opinions of Grant Thornton International Ltd or any of its
member firms.
3. Key findings
MARTIN GODDARD
GLOBAL SERVICE LINE LEADER – TRANSACTIONS
GRANT THORNTON INTERNATIONAL
Over recent years, practitioners Three years in, the answer to the Three years ago, as the clouds
within the private equity industry question of whether we are emerging gathered with the tightening of the
might have been forgiven for thinking from the global economic downturn debt markets, dealflow within the
they were facing something of a or about to slip into a double-dip is more developed private equity
perfect storm, with the industry being still to be answered. markets rapidly started to fall away.
challenged on all sides. Globally, the Through this, private equity has With the skies not having lightened
competitive environment within the been asked to reflect on both its own that much in the intervening period,
industry has become more intense place in the financial landscape and to the consequent increased competition
with quality dealflow at a premium, face up to its often compromised for quality deals has only been
while simultaneously Limited public perception. There are real compounded by the return of strategic
Partners (LPs) have become challenges here for the industry world- buyers, many of them keen to put
increasingly demanding and vocal, and wide. In this report, we consider what healthy balance sheets to work.
the industry has also received greater it means to undertake private equity in In the emerging markets, the sense of
scrutiny from the broader public and the principal private equity markets opportunity has seen something of a
regulators alike. Compounding the around the globe – in terms of both gold rush mentality with an influx of
industry’s own internal growing pains the challenges and opportunities – and Western private equity firms seeking
– which in some of the oldest private find an industry that, on many levels, new areas of opportunity and the
equity markets has seen the validity of is converging in terms of the way it rapid development of domestic private
the whole model questioned – has goes about business. However, while equity industries also driving
been one of the toughest macro operating a private equity firm in competition. Across the world, then,
economic environments in recent London, Sao Paulo, New York, there has been a shortage of quality
history, with portfolio companies Shanghai or Sydney may require assets at reasonable prices for a private
sucking in time and resource as they increasingly similar skills, functions equity industry which had been
face up to the economic headwinds. and approaches, the dynamics in those accelerating its accumulation of funds
individual markets driving this over the course of the previous decade
convergence often remain quite and, as a consequence, has a pent up
different. need to deploy capital.
Global private equity report 2011 1
4. Just finding shelter and sitting out inevitable concern. However, in these Historically, IPOs have often been
the storm hasn’t been an option for markets too, private equity firms a preferred exit route for private
private equity investors either. With report the growing relevance of equity firms, and they do remain a
the boom in investment activity in the added-value approaches to portfolio viable option in parts of Asia, for
run up to the downturn, private management. These markets are often example. However, this channel has
equity portfolios had grown still characterised by growth capital been all but closed for some time in
considerably and have often been investments, with low levels of Europe and the USA; overall public
demanding of attention as the leverage, meaning the focus too is on investor sentiment and desire to invest
environment has become more performance improvement. As these might be the issue in some regions,
challenging and unpredictable. markets become more globalised, but the perception of private equity
Creating ‘saleable’ businesses with there is a recognition of the need to has also acted as a particular brake on
enhanced valuations is the endgame ‘professionalise’ businesses, with the IPO option in some countries
for private equity firms and, while the private equity firms seeing a key largely due to perceived pricing issues.
exit markets are showing some signs aspect of their involvement as the The return of strategic buyers might
of life again, the torrid market for new introduction of international have added to the competitive
investments of recent years has often standards of governance and ways of pressure on the buy-side, but they
been reflected in the exit markets too. doing business in order to prepare have been a welcome sight on the
In the West, the challenging companies for eventual sale. horizon from an exit perspective. If
trading environment has seen a Generating quality exits and corporates present the industry with
renewed focus for private equity in returns has always been critical for something of a double-edged sword,
getting more closely involved in private equity, but their significance so too does private equity’s own
portfolio businesses – while leverage has, if anything, increased as holding ‘internal’ response to the need to both
and multiple arbitrage might have periods have been stretched. In put money to work and generate
worked in a rising market, come the developed markets, private equity returns – secondary buyouts. While
downturn performance improvement firms are starting to bump up against many practitioners themselves remain
is the order of the day. Many private the investment hurdles of their fund very aware of the need to provide a
equity firms have therefore been cycles which need to be negotiated clear rationale for such deals in order
responding by ‘tooling up’ and even before new funds can be raised. to convince investors that they are not
establishing more formalised portfolio In some of the more emerging just fuelling an internal market in
operations teams to add more strategic markets, the development of the private equity assets, they have
insight and even operational resource industry is still at an early stage, but become an established feature of the
alongside the financial planning there is again a sense that the developed markets. However, even in
insight provided. enthusiasm and promise on the back the more growth-oriented emerging
In many of the emerging markets, of which these markets have grown markets they are also gaining
economic growth has been less of a now needs to come good in the form significance.
concern – GDP growth of seven or of demonstrable returns.
eight percent plus might be difficult to
imagine in Europe or North America,
but markets such as Brazil, India and
China have seen sustained growth and
continue to drive forward even
though the fear of over-heating is an
2 Global private equity report 2011
5. Maintaining a true course through The more forensic approach being Troubled waters perhaps, and ones
such choppy waters was always going taken by institutional investors may which no doubt will see more
to present challenges for investing and bring with it a greater administrative casualties to come, but good
exiting. But churn has also been a burden for private equity firms, but it helmsmanship and a solid crew (and a
feature of the fundraising environment can be seen as an integral part of the bit of luck here or there) still leave the
as well. Institutional investors have longer-term trajectory of an industry chance to navigate through
themselves faced considerable that also includes being under the successfully. There is a strong sense
challenges in recent times, not least increasingly watchful eye of the within the industry, whether in
within their private equity regulators – given added momentum developed or emerging markets, that it
programmes, which has led to a by the pressures exerted by the macro is a time to focus on the fundamentals
significant period of reassessing environment, for sure, but something of private equity investing – building
allocation strategies and the balance that was already well underway. While relationships, getting your hands dirty
between investing via re-ups (repeat some may worry that the inherent alongside management at the coalface,
investments with an existing investee entrepreneurial spirit of the industry is focusing on performance
manager) and identifying new under threat, others will see scrutiny improvement and proving the model
managers, potentially in new markets. and regulation as proof of an industry through good exits and good
Private equity firms rarely fail and institutionalising as it plays a higher company stewardship. This approach
disappear overnight, but the ability to profile and more significant role in then needs to be effectively and
generate returns and raise new funds is economies around the world. continuously communicated,
the life-support machine that, if Undoubtedly in the West, as more providing a stream of concrete
switched off, will see firms die slowly. high-profile businesses have come examples to educate, and in the more
There is still a clear sense that there under private equity ownership, developed markets perhaps re-
will be winners and losers within the interest from the regulatory educate, an ever-expanding range of
industry. The Darwinian process at authorities, politicians and the public stakeholders that the private equity
work will undoubtedly ensure the in general has increased markedly, and model does work as a positive catalyst
long-term vitality of the industry, but such attention is certainly not always for change and value growth. With
many also believe that the increased favourable; indeed it sometimes feels overall global economic sentiment
intensity this has brought to the as if it has become fashionable to making a shift in the wrong direction
selection and monitoring of criticise and blame private equity at during the latter stages of this research
investments by LPs will continue to the slightest opportunity, not least project, perhaps even dampening
be felt by private equity firms around because of the industry’s perceived some of the signs of cautious
the world for a long time to come. opacity. Elsewhere in the world, the optimism evident throughout this
industry has more quickly gone down report, the need to support and
a similar path as the desire to promote encourage such catalysts of wealth
private equity and growth has creation and economic development –
sometimes battled with a lingering a force for growth – is stronger now
scepticism about private equity than ever before.
practices and a desire to protect a
culture of family-owned business.
Global private equity report 2011 3
6. Global picture:
Investment activity
FIGURE 1: SOURCES OF DEALFLOW
PERCENTAGE
Western Europe North America Asia Pacific MENA BRICS Global result
Corporate divestments 20 15 23 20 8 17
Family/private 31 52 38 60 68 46
Secondary buyouts 47 30 23 20 10 30
Public markets 1 3 13 0 6 4
Other 1 0 3 0 8 3
• Firms in family and private ownership continue to be seen as the principal source of private equity dealflow.
• Secondary buyouts are a feature of all markets, but are expected to be particularly prevalent in the developed European arena.
• Respondents in the emerging markets of Asia Pac and BRICS have the most varied expectations in terms of deal sources.
“With origination you need to be able “Healthcare continues to be a key “Assuming that the economy will
to get through every level of the sector and we participate in its modestly improve, and not
process successfully. You need basic consolidation. Consumer and retail deteriorate, there should be an
hygiene factors, some differentiating are very active, driven by large increase in both dealflow and
factors and some compelling factors. domestic demand. Energy and completed deals. There’s a lot of pent
On the hygiene factors, you need infrastructure are other sectors to up seller demand, and a lot of pent
money, a fair price, good processes watch, and ones where there has up buyer demand, and when those
and well-oiled due diligence. The been a lot of competition from local two things coincide, deal flow
differentiators are often linked to the and foreign strategic partners.” increases.”
people you have, your international
TURKEY survey respondent UNITED STATES survey respondent
networks, your understanding of the
business, your relationship with
management and your brand. The
wow factors tend to come down to the
individual leading the deal and the
more personal factors.”
UNITED KINGDOM survey respondent
4 Global private equity report 2011 – Global picture
7. FIGURE 2: MOST ACTIVE SECTORS
“It is significant that the Consumer
consumer sector is cited Business services
as the most active. This Industrials and manufacturing
Healthcare
could change if a double TMT
dip recession does occur.” Financial services
Education
STEVE BRADY Natural resources
PARTNER, HEAD OF TRANSACTION ADVISORY
Energy
SERVICES
GRANT THORNTON, US Infrastructure
Food and agribusiness
Real estate and construction
While the macro headwinds are still
Software and IT services
blowing around the world, there is a
sense within the global private equity
community of optimism. With caution FIGURE 3: INVESTMENT ACTIVITY BY REGION
PERCENTAGE
still the watchword, approaching two-
thirds of GPs included within this Western Europe 50 43 7
survey nevertheless believe that
investment activity will increase over the North America 63 30 7
coming year. It has been fashionable to
Asia Pacific 66 27 7
talk of the rise of the East both inside
and outside private equity, and although MENA 62 38 0
there’s no doubt that the developed
markets have suffered most, recent times BRICS 72 22 6
have served as a reminder of the
Global result 61 33 6
interconnectedness and mutual reliance
of global markets in the modern era. Increase Stay the same Decrease
Globally, the principal impacts of the
downturn have been to raise the spectre • Over 60% expect an increase.
of an industry shake-out and to see • Caution is most clearly expressed in Europe, where over 40% expect it to remain at current levels.
• BRICS respondents are most positive, driven particularly by respondents in Brazil and India.
levels of quality dealflow reduced. The
reaction of the private equity industry
has been to align itself with the best
opportunities, wherever they may be. FIGURE 4: SOURCES OF COMPETITION
PERCENTAGE
This flight to quality has resulted,
inevitably, in increased levels of Western Europe 47 11 38 0 3 1
competition which has also kept prices
North America 65 5 30 0 0 0
for the best assets high. The strength of
corporate balance sheets has served to Asia Pacific 46 29 21 0 4 0
intensify this competitive environment.
MENA 36 30 15 0 15 4
BRICS 40 32 18 5 3 2
Global result 48 20 26 1 4 1
Domestic Foreign/ Trade Public Family Other
private international buyers markets offices
equity private equity
Global private equity report 2011 – Global picture 5
8. “We’re seeing good private equity dealflow and a
strong pipeline. Entrepreneurs and families are coming
out of hiding and are looking for finance to support
growth.”
ARNAUD LIMAL
PARTNER, CORPORATE FINANCE
GRANT THORNTON, FRANCE
FIGURE 5: KEY FACTORS IN IDENTIFYING AND WINNING DEALS The reawakening of the corporate
Corporate/entrepreneur networks community, including the restructuring
Advisory relationships of larger businesses, means that the
Sector expertise traditional channels of private equity
Local presence dealflow, namely family- and privately-
Track record/reputation owned businesses and corporate
Price divestments, are expected to remain the
Value add proposition dominant sources. However,
Access to capital competition within the private equity
Deal process management industry itself has helped promote an
Management chemistry environment where secondary
Speed
transactions can take hold, with this
Strategic differentiation
being an increasingly relevant feature of
both the developed and more nascent
markets.
In this new landscape, everything
points to the enhanced importance of
networks. In emerging markets, this
manifests itself in the need for local
presence and an understanding of local
business cultures. Whereas in more
established markets, rising competition
has emphasised the need to self-
originate, act fast and develop an angle.
“It’s still a very competitive market “The two main sources of deals here “I’d have to say that at this point in
and unfortunately that means that are entrepreneur-owned businesses time we are more cautious than
price matters most when competing who are unable to access debt optimistic about the economy.”
for deals. In a hot market, it’s always funding any more, and the public
CHINA survey respondent
price and terms, and then the markets which are becoming
probability of close. How strongly you interesting because of the stock
can demonstrate that you can market pricing.”
deliver.”
HONG KONG survey respondent
UNITED STATES survey respondent
6 Global private equity report 2011 – Global picture
9. Portfolio
FIGURE 6: AREAS OF HANDS-ON INVOLVEMENT Throughout the downturn, private
Strategic input equity firms around the world have
Financial planning found themselves having to focus more
Human resources on working with portfolio businesses in
M&A order to help strengthen their positions
Operational input in an adverse climate. While the skills
Professionalisation might have been honed in firefighting,
Governance they are now proving useful where
Access to networks private equity firms are operating in
Cost control low-growth environments.
Internationalisation Given the low growth in some
Mentoring
markets coupled with the lack of value
Exit planning
uplift available from leverage or multiple
Monitoring
arbitrage, many private equity houses
Sector knowledge
stress the importance of performance
Managing banking relationships
enhancement as a value driver and
Access to capital
highlight their input in a number of key
Kudos
areas in aiding this. In particular,
Innovation
strategic input is universally seen as
central to the private equity offering.
Around the world, the professionalisation
of businesses as they develop under
institutional ownership is something
which private equity players can and do
contribute to. Assistance with
operational systems, financial planning
and human resources are oft-cited
benefits that private equity ownership
“With the market as challenging as it is at the moment, can bring to companies.
adding value is the only way of really unlocking returns.
Groups are finding they have to do more and work more
closely with their portfolio management teams. Some got
caught out before, and now there’s no going back – if
you want to generate a return, you have to work for it.”
STEVE LUKENS
HEAD OF ADVISORY
GRANT THORNTON, US
Global private equity report 2011 – Global picture 7
10. “The value we bring is really about FIGURE 7: HANDS-ON PORTFOLIO INVOLVEMENT
PERCENTAGE
boosting growth initiatives, reinforcing
corporate governance and Western Europe 15 74 11
strengthening management teams.”
North America 17 73 10
SINGAPORE survey respondent
Asia Pacific 31 69 0
MENA 36 64 0
BRICS 25 75 0
Global result 22 72 6
The likelihood that portfolio Increase Stay the same Decrease
companies will be involved in M&A
activity varies considerably by company
FIGURE 8: PORTFOLIO VALUE DRIVERS
and GP. However, there is a general PERCENTAGE
sense that M&A levels will increase, with
Western Europe 17 39 32 3 9
this likely to include cross-border
acquisitions. While GPs are mindful of North America 29 49 14 0 8
the challenges involved in making M&A
work, and indeed the additional cultural Asia Pacific 36 45 14 0 5
and complexity challenges posed by
MENA 26 49 17 4 4
cross-border deals, factors such as
relatively cheap assets and opportunities
BRICS 35 46 13 2 4
to rapidly access growing markets are
serving to encourage activity. Global result 27 44 20 2 7
A further aspect of portfolio firm
Market Performance M&A Financial Multiple
professionalisation in which private growth improvement growth engineering Arbitrage
equity is playing a role is in relation to
Environmental, Social and Governance
(“ESG”). Governance, in particular, is an FIGURE 9: ESG
PERCENTAGE
area of GP focus globally, both reflecting
the ‘best practice’ aspect of this approach Western Europe 41 41 13 5
as well as a recognition of increasing
North America 30 17 17 36
pressure from other stakeholders,
including LPs and regulators. Asia Pacific 33 42 17 8
MENA 0 33 50 17
BRICS 34 38 22 6
Global result 32 35 20 13
Highly Growing Of some Not
relevant relevance relevance relevant
8 Global private equity report 2011 – Global picture
11. Exit
FIGURE 10: EXIT ACTIVITY
PERCENTAGE
Western Europe North America Asia Pacific MENA BRICS Global result
Increase 69 53 74 79 50 63
Stay the same 18 40 13 14 36 26
Decrease 13 7 13 7 14 11
• Over 60% of respondents expect to see exit activity increase over the next 12 months.
With what was an accelerating The pressure to exit for some is, Inevitably, secondary buyouts
population of private equity backed however, matched by the pressure to provoke debate about their pros and
businesses leading up to the downturn, invest for others, namely those who have cons. However, in those markets where
coupled with the closing of most viable dry powder to deploy before the end of they are an established feature, they have
exit routes at the peak of the crisis, the agreed investment periods. These push provided the lifeblood of the exit market
private equity industry has found itself and pull drivers are the key factors in the in an environment where IPOs have
with rapidly aging portfolios and, with increasing trend towards secondary been very difficult to achieve. In
fundraising looming in many cases, a buyout activity in recent times. emerging markets, secondary buyouts
need to achieve realisations. This is are yet to achieve the same position, but
reflected in the fact that approaching are increasingly seen.
two-thirds of GPs globally expect to see
an increase in exit activity over the
coming year.
“Secondary buyouts work well here, “The global financial crisis resulted in
but for different reasons. India is a a lengthening of the holding period
growth market dominated by minority for portfolio companies and typically
expansion investments. As a natural has led to a delay of 1-2 years in the
part of this, the businesses backed investment cycle, which has been
need larger capital injections as used to fix and repair portfolio
they grow and this presents good companies. Now that these two
opportunities for financial investors years have passed, portfolio
up the scale.” companies are ripe for exit.”
INDIA survey respondent SOUTH AFRICA survey respondent
Global private equity report 2011 – Global picture 9
12. FIGURE 11: EXIT ROUTES
PERCENTAGE
Western Europe North America Asia Pacific MENA BRICS Global result
IPOs 1 9 5 16 37 14
Trade sale 54 56 62 68 43 54
Secondary buyout 45 35 33 16 20 32
The other saving grace for private FIGURE 12: AVERAGE RETURNS
PERCENTAGE
equity firms in realisation mode has been
the appetite of trade buyers. This Western Europe 35 35 30
highlights the positive side of the
North America 34 45 21
double-edged sword for private equity
that is an acquisitive corporate Asia Pacific 38 23 39
community.
Given the range of competing factors MENA 29 42 29
at play, practitioners find it difficult to
BRICS 50 42 8
form a certain view as to the direction of
returns for the industry. On the one
Global result 35 38 27
hand, high entry prices, continuing
global macro uncertainty and a shortage Increase Stay the same Decrease
of debt have applied downward
pressure. On the other, improving
confidence, a buoyant secondary market
and trade appetite keep optimism alive.
Despite this, the prevailing view is that
the coming period will see both winners
and losers and it will be this that
determines the shape of the industry
going forward.
“There is optimism that exit activity will increase this
year. The nature of private equity is such that investors
measure performance against a benchmark and this is
how LPs look at the world. GPs are engaged in an
ongoing process of understanding what’s important to
LPs; ultimately this comes down to getting capital back
and churning portfolios.”
HARISH HV
PARTNER, HEAD OF TRANSACTION ADVISORY SERVICES
GRANT THORNTON, INDIA
10 Global private equity report 2011 – Global picture
13. Fundraising
FIGURE 13: AREAS OF INCREASING LP DEMANDS For private equity firms heading out to
Transparency market, the fundraising environment
Performance remains testing. Practitioners point to
ESG the increasingly polarised nature of the
Fees market in which high performers are
Commitment to strategy able to raise, and even quite quickly,
Governance while others find it tough. This is linked
Key man to a flight to quality by LPs which has
Fund secondary DD seen even some of the most longstanding
Differentiation relationships reassessed.
Value drivers Simultaneously, the industry has seen
Alignment
a clear shift in the balance of the GP–LP
Direct competition
relationship, with investors increasingly
Co-investment
willing to demand more transparency
Dealflow
and seek demonstrable performance, not
least in newer private equity markets
that have been sold hard in recent times
and now need to prove they can deliver
the promised returns. In developed
“The fundraising environment is both positive and
markets, LPs have sought to find a
negative. There are plenty of firms hitting the fundraising collective voice with which to put their
jackpot and deservedly so, but equally there are many case. In particular, initiatives such as
players who are really struggling. Ultimately, painful as ILPA and the drive for a particular
fund’s LPs to hold closed meetings
it is for some, it’s probably a good thing for the industry.” without the GP present illustrate the
FRANCOISE NOEL-MARQUIS
more ‘forensic’ approach now being
PARTNER employed.
GRANT THORNTON, FRANCE
“I think it’s a competitive fundraising “The big problem for the local market “Fundraising is pretty tough. A lot of
environment. It’s better than it has is the total lack of returns made. people flooded into the market and
been but people still have exposure to There just haven’t been enough of there is possibly now a bit of a knee-
bad funds. The denominator issue is them and as a result there are some jerk as people fear conditions are too
diminishing, as is the liquidity issue, very poorly-performing funds.” overheated.”
but the overhang is still there and
VIETNAM survey respondent BRAZIL survey respondent
existing managers are scrapping for
re-ups.”
UNITED STATES survey respondent
Global private equity report 2011 – Global picture 11
14. “It is harder to raise funds now and “LPs are reducing both their allocations and the number of GPs they
we will continue to see a flight to want to work with. They have learnt a lot in recent times and are more
quality. We’re in a situation where the discerning about performance and the way they are treated by GPs. These
better end of town will do well, but the days more than ever, strong performance and transparency are key.”
rest will find it very tough. It is the
UNITED KINGDOM survey respondent
same highly-selective environment on
the deal side as well, with the lending
banks definitely having an A list of GPs.”
AUSTRALIA survey respondent
There are signs of longer-term FIGURE 14: FUTURE FUND SIZE VERSUS PREDECESSOR
PERCENTAGE
confidence with many GPs expecting to
be able to raise larger funds in the future. Western Europe 46 51 3
This is most notably a feature of
North America 50 42 8
emerging markets, with evidence of the
process of fund size inflation having Asia Pacific 83 0 17
paused in developed markets.
A clear outcome of the changing MENA 61 31 8
sentiment in the investor community is
BRICS 75 0 25
the expectation amongst GPs globally
that there will be a degree of churn
Global result 56 36 8
within their LP bases. Pressures in this
respect vary from country to country Larger Same size Smaller
and fund to fund, but it is clear that
while in some regions the opening up of • Taking fund size as a measure of the likely future size of the industry suggests that emerging
market PE firms are confident of future growth.
domestic sources of capital is seen as an
• Within the developed markets, the picture points more towards a stabilising of the industry size.
opportunity, in others the retrenchment
of domestic LPs is forcing GPs to build
increasingly international investor
FIGURE 15: FUNDRAISING ENVIRONMENT
relationships. This is, in effect, leaving PERCENTAGE
some GPs to compete for attention
Western Europe 9 11 33 27 20
amongst a broader range of peers by
convincing LPs of the attractiveness of
North America 4 22 26 41 7
their firm and market in an international
arena. Asia Pacific 0 13 7 47 33
MENA 0 46 31 23 0
BRICS 3 36 22 33 6
Global result 4 24 26 33 13
Very Positive Neutral Negative Very
positive Negative
12 Global private equity report 2011 – Global picture
15. Overall market outlook
FIGURE 16: KEY CHALLENGES FACING THE PRIVATE EQUITY INDUSTRY With the global economic situation still
Macro economy very much in the balance, macro
Regulation economic considerations are regarded as
Competition the greatest challenge currently facing
Performance the private equity industry worldwide.
LP sentiment The fallout from the downturn has also
Deal origination triggered increased attention from
PE perception national regulators seeking to drive more
PE HR transparency from financial institutions.
Access to debt The inherent opacity of the private
Portfolio issues equity industry has made it a lightning
Industry maturity
rod in some instances, giving
Exiting
momentum to a process that had already
Tax
begun on the back of concerns about job
Geo-political factors
security and asset stripping as businesses
Fiscal environment
with larger (often politically sensitive)
Human resources
stakeholder groups came under private
Secondary buyouts
equity ownership in some markets. This
has added to the challenges faced by the
industry, with firms noting the need to
educate and sell the benefits of private
equity on an ongoing basis.
“I think in general the industry has a “The reliance on leverage, and also
problem in generating the types of the ability of private equity companies
returns to justify the asset class. to differentiate themselves both
There just hasn’t been the present challenges.”
performance in recent times.
AUSTRALIA survey respondent
Institutional investors are getting
disillusioned. That’s a problem the
industry needs to work on.”
CANADA survey respondent
Global private equity report 2011 – Global picture 13
16. FIGURE 17: AREAS OF RECRUITMENT
“One of the biggest PERCENTAGE
issues for the industry is Deal doing 37
Portfolio operations 14
one of perception. Every Research 11
time the industry puts its Admin 4
head above the parapet, it IR 4
Legal 1
risks getting it shot off by Other 1
either the press or the N/A 28
Government. I think it’s
symptomatic of the fact FIGURE 18: AREAS OF NEW BUSINESS DEVELOPMENT
PERCENTAGE
that when times are hard, Core business 48
people look to blame Geographic opportunities 17
someone.” Sector opportunities 9
Asset class opportunities 7
MARTIN GODDARD Deal size shift 3
GLOBAL SERVICE LINE LEADER – TRANSACTIONS Independence 1
GRANT THORNTON INTERNATIONAL
Privatisations 1
N/A 14
The bulk of the other key challenges GPs that are looking to diversify
faced by the industry relate to the need their areas of interest as the global macro
to demonstrate performance in today’s trends play out are most likely to look
highly competitive environment. Given for similar opportunities within new
this backdrop, it is no surprise that the geographies. Wherever the focus, the
key focus of, and opportunities pursued common factor is the need for
by, private equity firms relate to their communication, whether that be
core business. While the drivers are introducing the asset class, re-educating
somewhat different in the emerging and stakeholders, or demonstrating the
more developed markets, the shared ability to generate returns.
outcome is a perceived need to sharpen
deal origination and portfolio
“The big challenges to the industry all
management processes, with many firms
stem from regulatory issues and the
being in the process of augmenting their
fact that PE has been lumped
teams in these areas. In the mature
together with the banks and hedge
markets, the long-term process of
funds. All of the resulting scrutiny is
institutionalisation has seen teams
leading to more and more admin –
expand in many areas to support larger
and that is not value-adding. There is
portfolios and fundraising ambitions.
massive pressure on resources and
Paradoxically, there is a opposing
this will translate into problems for
pressure to minimise back office costs.
returns. There is also a problem
In the emerging markets, the rapid
associated with all the attention on
development of private equity has
fees and remuneration. If there is too
required GPs to work to ensure that
much pressure here we will not be
their own development in human capital
able to hire the top people and they
terms keeps pace.
will simply go to hedge funds.”
GERMANY survey respondent
14 Global private equity report 2011 – Global picture
17. Western Europe:
Investment activity
FIGURE 1: KEY FACTORS IN IDENTIFYING AND WINNING DEALS Confidence in the prospects for dealflow
Corporate/entrepreneur networks over the coming year is returning slowly
Advisory relationships amongst European private equity firms
Sector expertise with around half expecting an increase in
Track record/reputation activity. Although this is the lowest level
Access to capital recorded in any of the key global
Deal process management markets, very few people actually expect
Price to see investment levels decline.
Local presence Anticipated sources of dealflow are
Value add proposition particularly varied in Europe. However,
Management chemistry most strikingly the importance of
Speed
secondary buyouts is higher than in any
Strategic differentiation
other market.
With dealflow in the region being
generally hard won, private equity firms
have sought various ways to get ahead of
the competition. In the first instance this
involves building and consolidating
networks both within the corporate and
advisory communities. However, whilst
track record is still very important, there
is also an increased emphasis on building
knowledge of markets and the dynamics
of individual businesses and their
management at an early stage in the
process.
Ultimately, most deals will go
“I believe secondary and tertiary deals “There’s more competition from trade
through some form of intermediation
will continue to be very important, buyers, and I expect this to continue
and market testing of the price. This is
particularly for larger mid-market to increase. Trade players are getting
the case not least because trade buyers
deals. In 2010 the largest proportion more confident, and unless the
have returned as a key competitor to
of deals above Euro 75m was economy ends up in a double dip, I
private equity, and one with deep
accounted for by secondary buyout can’t see this changing – they’ll be
pockets for the right asset strategically.
activity. Under Euro 75m a lot more out in force. There are lots of private
deals were primary transactions. The equity houses with money, but this
fact is that we’re seeing corporates can only dwindle over the medium– to
being less focused on divestiture, but long-term, not increase.”
much more acquisitive.”
UNITED KINGDOM survey respondent
UNITED KINGDOM survey respondent
Global private equity report 2011 – Western Europe 15
18. “It’s a combination of factors, but FIGURE 2: SOURCES OF DEALFLOW
PERCENTAGE
really it comes down to your
networks, increasingly your sector
Public markets: 1%
knowledge and focus, rigour,
Other: 1%
discipline and tenacity. Clearly you
can’t discount the value of Secondary buyouts: 47% Corporate divestments: 20%
intermediary networks, but GPs are
spending a lot more time on non-
intermediated deals these days.
There will always be auctions, but you
want to try to avoid them if you can,
Family/private: 31%
or at least make sure you have a
head start.”
UNITED KINGDOM survey respondent
“Deal sourcing is the same now as it’s
always been for us. It’s about being as
early as you can on an asset, and not
waiting for the pitch from banks. It’s
about spending more time with
management teams and vendors to FIGURE 3: SOURCES OF COMPETITION
PERCENTAGE
understand the asset before it comes
to market, which means you’re more
Others: 1%
prepared and can move faster.”
Family offices: 3%
FRANCE survey respondent
Trade buyers: 38% Domestic private equity: 47%
“The market in Italy is split between
those deals that are marketed above
and below the radar. For the former
you obviously need to have a strong
relationship with the intermediaries,
but these are more commodities. The
real key in Italy is to have a big
network of contacts among the
entrepreneurs.”
ITALY survey respondent
“It will mainly be secondaries. Most Foreign/International private equity: 11%
German corporates have completed
their disposal programmes and
entrepreneurs are reluctant to sell
assets only to see their money get “Speed is key in deal origination. It is a very competitive
sucked into sovereign debt crises!” market and so getting to deals early is crucial. Strong
GERMANY survey respondent
relationships with intermediaries is a key part of this.”
PAR EKENGREN
HEAD OF CORPORATE FINANCE
GRANT THORNTON, SWEDEN
16 Global private equity report 2011 – Western Europe
19. Portfolio
FIGURE 4: AREAS OF HANDS-ON INVOLVEMENT Hands-on involvement with portfolio
Strategic input investments has risen to relatively high
M&A levels in Europe versus other parts of the
Human resources world and is expected to remain so, with
Operational input the key focus of GP efforts typically on
Financial planning strategic input and M&A. Assistance
Internationalisation with financial planning has also been
Professionalisation significant, with the majority of GPs
Cost control reporting that debt renewal will not be
Access to networks an issue over the next 12 months.
Mentoring European private equity firms are
Exit planning
more cautious regarding portfolio
Monitoring
prospects than their counterparts in
Managing banking relationships
other parts of the world, with the macro
Governance
economic environment being cited as the
Innovation
chief driver of sentiment.
Sector knowledge
“The nature of the value drivers depends on the “Growing market share through
innovation is fundamental. The
business and what you’re trying to do to it. In some businesses I like are in big markets
cases it could be a mixture of multiple arbitrage and with lots of players, some big groups
M&A; in others it might be more organic. You need to with lots of legacy systems, and you
find someone smaller with an
build a growth strategy to suit the individual innovative approach. The majority of
company.” deals we do like this would succeed
even if the market stayed flat in my
MO MERALI
PARTNER, HEAD OF PRIVATE EQUITY
personal view.”
GRANT THORNTON, UK
UNITED KINGDOM survey respondent
Global private equity report 2011 – Western Europe 17
20. Portfolio M&A support is seen to be FIGURE 5: PORTFOLIO VALUE DRIVERS
PERCENTAGE
more important amongst European
private equity firms than elsewhere. In
particular, crossborder M&A is seen as Multiple arbitrage: 9%
an increasingly relevant feature. Financial engineering: 3% Market growth: 17%
However, with this comes the additional
challenges of cultural issues and relative
M&A growth: 32%
complexity. These are perhaps thrown
into even sharper relief when Performance
transactions are being considered improvement: 39%
beyond European borders in markets
such as China, which is now on the
radar for an increasing number of GPs.
FIGURE 6: CHALLENGES TO CROSS BORDER M&A
PERCENTAGE
Funding constraints 2
Foreign market credibility 2
Different fiscal environment 2
Currency risk 2
Lack of opportunities 7
Parochialism 9
Management team 13
“There are massive cultural
Lack of PE resource 13
differences between China and the
Relative complexity 18
West. You can’t afford to ignore China
Culture 32
and you need to understand it as best
you can. Doing business in China is
not to be taken lightly.”
UNITED KINGDOM survey respondent
“The benefits of cross-border M&A
really depend on the company – if the
company is already international,
then it is almost business as usual…
they will understand what they are “The main thing is to get the right strategic equity story to be developed
doing and there is a good basis of and executed. We are keen to pursue a long-term plan that is signed off by
due diligence to draw upon. If the both the management and ourselves.”
company is venturing abroad for the
GERMANY survey respondent
first time or it is the first acquisition,
it is more tricky. There is more work
to be done with the management “As a whole, and not just in terms of the weak GDP announcements
team to convince them and us that it recently, the economy is shaky and confidence is low – I just don’t think it
is a good thing to do.” feels good.”
FRANCE survey respondent UNITED KINGDOM survey respondent
18 Global private equity report 2011 – Western Europe
21. Exit
FIGURE 7: EXIT ROUTES Sentiment regarding prospects for the
PERCENTAGE
exit market are generally positive, with a
window of opportunity seen to have
IPOs: 1%
opened up over the last year. Around
Secondary buyout: 45% Trade sale: 54% three-quarters of European respondents
also expect exit levels to continue to
increase over the coming year, which
compares favourably with their
counterparts elsewhere.
“Secondaries are driving the market “The main cons of secondary buyouts
because on one side you have people are that they almost always come via
who need to return capital in order to highly contested auctions and are
fundraise and on the other you have therefore expensive. On top of that,
people who need to deploy capital.” the former owner has normally done
a good job with the business making
SWEDEN survey respondent
it difficult to see further growth.
Sometimes though, it is just a
question of fit and it can really work
better for the second buyer than the
first.”
GERMANY survey respondent
Global private equity report 2011 – Western Europe 19
22. The two key drivers of these exit
trends are: first, the return of trade “Returns have, fundamentally, been pretty strong. If
buyers, which, while increasing the exit markets aren’t great then, by and large, private
competition on the buyside, is also equity firms just sit on investments for longer and wait
proving a willing source of liquidity for
private equity assets, and; second, the
until they can get value.”
pressures being felt by many private KAI BARTELS
equity firms in relation to their own SENIOR PARTNER, HEAD OF M&A
fundraising cycles and the need to both GRANT THORNTON, GERMANY
deploy capital and demonstrate returns.
The IPO window is seen to be very
firmly shut in Europe, with the
consequence that, in comparison,
secondary buyouts have taken on an
added significance.
The cocktail of competition and
pressure to exit is resulting in
considerable variation in expectations
for returns going forward. There
remains a sense that there will be
winners and losers and that a final shake
out within the industry is still to happen.
“I think returns will stay the same in “I think exit levels will increase
the short term, but longer term they because of the maturity profile of
will decrease. The best performers portfolios at the moment. There have
will maintain their high returns, but certainly been some great exits
the discrepancy between the best and recently. The challenge is always
the worst will increase.” having the patience to allow
companies to mature.”
FRANCE survey respondent
UNITED KINGDOM survey respondent
20 Global private equity report 2011 – Western Europe
23. Fundraising
FIGURE 8: AREAS OF INCREASING LP DEMANDS Unsurprisingly, European private equity “We’ve just come off a fundraising
Transparency practitioners continue to regard the and it’s incredibly competitive out
ESG fundraising environment as tough by there. Pretty much every LP in the
Performance historical standards. With many world is reducing the number of GP
PE firm management investing institutions still working relationships they have and will only
Fund secondary DD through their own problems, while they consider re-ups and new relationships
Commitment to strategy remain positively disposed towards with top-tier managers, so it’s very
Differentiation private equity, they are having to look very tough.”
Co-investment closely at the number and size of their
Key man UNITED KINGDOM survey respondent
commitments to the asset class.
For GPs, this sentiment means
higher levels of LP churn within their “ESG matters are becoming much
investor bases as institutions more important. We signed the UN PRI
contemplate future funds. GPs are last year and contributed to AFIC’s
readying themselves for the prospect of White Paper on ESG. We have a
needing to identify a higher proportion dedicated in-house team and are doing
of new investors than in the past and the a big appraisal on the subject now. It is
likelihood of a stagnation in fund sizes. extremely important for the image of
In addition, GPs are reporting a the industry and to satisfy the LPs.”
higher degree of LP engagement. A
FRANCE survey respondent
greater desire amongst investors for
transparency and depth of information is
the key trend here. While areas such as “LPs are drilling into companies more
performance clearly continue to be of than they have in the past – what
key importance to LPs, there is also an makes them tick, why we did the
increasing focus on ‘new areas’ such as deal, where the key threats are.
ESG and the management of the private However, most LPs have 70-80 fund
equity firm itself. interests, and they just don’t have
time to sit down with every one of
their GPs and go through things in
such detail.”
“It’s very difficult at the moment. But if
you look at the past, LP appetite has UNITED KINGDOM survey respondent
normally returned 9-12 months after
M&A activity has kicked back into gear
and liquidity rises. With any luck that
will be felt in the next year.”
GERMANY survey respondent
Global private equity report 2011 – Western Europe 21
24. Overall market outlook
FIGURE 9: KEY CHALLENGES FACING THE PRIVATE EQUITY INDUSTRY Reflecting the underlying positive
Macro economy sentiment with regard to expected deal
Performance and exit activity, private equity firms are
LP sentiment building capacity in order to capitalise
Regulation on the opportunities ahead. In particular,
PE perception around two-thirds of European
Deal origination respondents are planning to increase
Competition their head count over the coming year,
PE HR with this predominantly being in the
Access to debt core area of front-line deal-doing.
Portfolio issues With increased emphasis being
Industry maturity
placed on self-origination strategies and
Exiting
recruitment, it is no surprise that the
Secondary buyouts
majority of private equity firms stress
Geo-political factors
the importance of focusing on their core
business of identifying quality
businesses within their target market.
Private equity players are currently
faced with a plethora of challenges, some
private equity specific, some regulatory,
and others reputational. However, the
most significant factor relates to the
challenges presented by the state of the
macro economy.
Regulatory matters are high on the
agenda of GP concerns, not least the
introduction of the AIFMD. This
particular initiative is expected not only
to lead to higher levels of bureaucracy
and increased costs, but also to frustrate
the dynamism of the industry by raising
“Regulation is terrifying. The mindset “We are working on increasing our
barriers to entry for first time managers
out there is that what private equity build-up programme for the portfolio
and spin-outs.
does is terrible. How we combat this I and trying to profit from the fact that
don’t know. What is certain is that very good companies are struggling
regulation of the industry is going to to raise bank funding and therefore
become a lot more rigorous.” are turning to growth capital
providers for the first time.”
UNITED KINGDOM survey respondent
SPAIN survey respondent
22 Global private equity report 2011 – Western Europe
25. “We have been through the worst FIGURE 10: IMPACTS OF EU REGULATION
PERCENTAGE
downturn since WWII and companies
have demonstrated they have the Bureaucracy 38
DNA to survive in a market that gets Costs 20
Barriers to entry 7
little support from government. The
Capital adequacy rules 7
main opportunity is to harness the
Fundraising 4
strength of those businesses and help
Less competition 2
them into new markets.”
Risk perception 2
ITALY survey respondent Transparency 2
N/A 18
“You can see that the AIFMD
represents a challenge, but it will FIGURE 11: AREAS OF NEW BUSINESS DEVELOPMENT
PERCENTAGE
help generate a better understanding
of the industry.” Core business 60
Geographical opportunities 16
SWEDEN survey respondent Asset class opportunities 7
Sector opportunities 7
Deal size shift 2
N/A 8
“Competition is the
biggest issue facing the
industry. You can really
see the need for
consolidation in the
market – there are too
many players with too “In these difficult economic times, private equity is
much committed capital. faced with not only an origination issue, but also
Those funds with capital pressure from investors, regulators and the broader
still to invest will be public. The industry is therefore being challenged to
under pressure, and this visibly prove the model and demonstrate it can add
will drive up prices.” value regardless of broader economic conditions.”
RAINER WILTS THIERRY DARTUS
PARTNER HEAD OF TRANSACTION ADVISORY SERVICES
GRANT THORNON, GERMANY GRANT THORNON, FRANCE
Global private equity report 2011 – Western Europe 23
26. North America:
Investment activity
FIGURE 1: KEY FACTORS IN IDENTIFYING AND WINNING DEALS Price remains king in North America’s
Corporate/entrepreneur networks highly intermediated and efficient
Price market and is seen by many as the key
Sector expertise factor in winning deals. However,
Advisory relationships evidence suggests a GP’s sector expertise,
Access to capital as well as the quality of its corporate
Deal process management networks, are central elements of their
Local presence approach to deal origination.
Value add proposition
Track record reputation
Management chemistry
Speed
“I think there are two key areas in
terms of deal sources: sponsor-to-
sponsor deals will be the biggest
area, followed by independent family-
owned businesses. For sponsor-to-
sponsor, the market’s been so
negative that they haven’t been able
to sell and so now’s the time.
Independent family-owned businesses
“I think PE investment activity over the “Origination is sector led. We’re calling may be a driver of deals as there’s
next 12 months will be increasing. I on companies in specialist areas where uncertainty around so this may drive
still think there’s lots of dry powder out we’ve invested before and built domain things through.”
there and banks are still lending as the knowledge, that’s how we differentiate.
UNITED STATES survey respondent
debt markets have softened a bit. The We’re proactive in terms of identifying
economy is in good shape in Canada companies we’re interested in and
but it’s all subject to company building up relationships over time, “As it always has been, winning deals
availability – whether there are several years prior to any investment comes down to who pays the highest
companies available to buy. Valuations opportunity. By the time an opportunity price. Of course, you need to be in
are strong so vendors are getting what does arise, we already know each front of the right intermediaries, but
they’re looking for and generally other, and that provides an advantage.” price is by far the biggest
there’s a willingness to transact.” determinant of success.”
UNITED STATES survey respondent
CANADA survey respondent CANADA survey respondent
24 Global private equity report 2011 – North America