Jump to content
House Price Crash Forum
Sign in to follow this  
OnlyMe

Pirate Equity Comeback

Recommended Posts

No doubt largely thanks to central bank monetary pigswill again - they can't help polluting the ecconomy with every turn.

http://www.ft.com/cms/s/0/5db55428-0c7d-11e0-8408-00144feabdc0.html#axzz193OQ2ifE

Private equity sets record for M&A share

By Martin Arnold, Private Equity Correspondent

Published: December 20 2010 23:26 | Last updated: December 20 2010 23:26

Private equity bosses have shrugged off the shock of the financial crisis and returned to the dealmaking fray faster than many people expected this year, as the value of UK buy-outs almost quadrupled from the previous 12 months.

With private equity accounting for a record 75 per cent of all UK mergers and acquisitions in the first nine months of this year, buy-out bosses have rediscovered their Keynesian “animal spirits” faster than corporate chief executives.

Share this post


Link to post
Share on other sites

Lots of them raised funds in the good times and have yet to put it to work and time is running out. Expect to see lots of deals done. I also expect lots of firms to quietly disappear.

Share this post


Link to post
Share on other sites

Lots of them raised funds in the good times and have yet to put it to work and time is running out. Expect to see lots of deals done. I also expect lots of firms to quietly disappear.

There's more fundraising than ever happening right now, as private equity looks to step into the gap left by the banks in funding small/medium businesses.

Share this post


Link to post
Share on other sites

There's more fundraising than ever happening right now, as private equity looks to step into the gap left by the banks in funding small/medium businesses.

no doubt this is part of the pledge of £200bn from banks to help "business"..

more like to help the useless OUT of business and the hopeful into DEBT...and the bankers into massive fees.

Share this post


Link to post
Share on other sites

no doubt this is part of the pledge of £200bn from banks to help "business"..

more like to help the useless OUT of business and the hopeful into DEBT...and the bankers into massive fees.

No. Equity and debt are opposites. If a business can raise money through equity then it doesn't need to raise the money through debt.

Don't be misled by the populist journos pointing and screaming at a handful of high-profile city gamblers on leverage. Most private equity doesn't look remotely like Guy Hands: it's long-term investment to help a business develop and grow.

Share this post


Link to post
Share on other sites

No. Equity and debt are opposites. If a business can raise money through equity then it doesn't need to raise the money through debt.

Don't be misled by the populist journos pointing and screaming at a handful of high-profile city gamblers on leverage. Most private equity doesn't look remotely like Guy Hands: it's long-term investment to help a business develop and grow.

I see, so the seller sells the equity in the business and takes .....what? equity? equity he already owned?

no, they need to convert equity to cash to pay off the old guys, the new use the equity to guarantee loans.

Now, I have heard of debt for equity, but this is usually done where the dent is having "difficulties" being repaid, so the banker takes a stake instead of a repayment.

course, if there are no bankers in the picture, then great....but M+As and stuff are great fee earners I hear.

Share this post


Link to post
Share on other sites

course, if there are no bankers in the picture, then great...

That's OK then. There are no bankers in the picture most of the time (beyond the simple fact of having a bank account).

Certainly none of the dozen or so funds I have a few squid in have any borrowings, nor do they use bankers when taking a stake in a business.

Share this post


Link to post
Share on other sites

That's OK then. There are no bankers in the picture most of the time (beyond the simple fact of having a bank account).

Certainly none of the dozen or so funds I have a few squid in have any borrowings, nor do they use bankers when taking a stake in a business.

I think you are mistaken here. Either you are invested exclusively in venture capital (a very small subset of private equity) or there will be significant leverage in the portfolio companies that the funds invest in. Private equity funds generally dont uyse leverage at the fund level but it is present at the portfolio company level in virtually all deals involving companies with earning to borrow against.

Share this post


Link to post
Share on other sites

There's more fundraising than ever happening right now, as private equity looks to step into the gap left by the banks in funding small/medium businesses.

There is a lot of fund raising happening now because a lot of funds have not been able to raise funds of late or its taking a long time to raise enough funds. In any case, fund raising happens every 4-6 ish years for a firm, if its cant raise a fund, it slowly dies.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 311 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.