The long-simmering question of whether buyout shops have to register as broker-dealers erupted this month in the form of a Securities and Exchange Commission enforcement action against Blackstreet Capital Management LLC. In a June 1 order, the SEC found that Blackstreet Capital had violated the Securities Exchange Act of 1934 by performing its own brokerage services — prospecting […]
In a macro environment that looks increasingly bleak, emerging-markets investors from around the world gathered in Washington in May to talk about how private equity is uniquely positioned to navigate the turbulence. Emerging markets have been hit hard by declines in commodities prices and the slowdown in China, which serves as one of the main […]
Chalk up one more reason that internal rates of return can be misleading — and one more reason that the industry needs to emphasize that they are not equivalent to compound annual growth rates. With interest rates low, growing numbers of buyout firms use capital-call bridging facilities to cover the equity portions of their deals in the early months. Sometimes the loans cover […]
Achieving a profitable exit is challenging, but PE firms have several ways to help their companies cut costs, ease risk and boost operational efficiency.
By Christopher M. Schelling Nearly all private-equity-style closed-end draw-down funds have a clause ensuring that the general partner remains focused on deploying the commitments of an existing fund prior to turning substantial business efforts toward raising a successor fund. The reason is clear. Limited partners want to ensure that their money is nearly fully invested […]
How carry gets divvied up among senior partners has more to do with who founded the firm than with individual performance, according to recent research. Moreover, investors have been right to worry that carry distributed in this way can lead to departures. Such are the findings suggested by a recent examination of 717 private equity funds — largely buyout […]
GPs should watch for the next big issues on the SEC’s radar as the agency moves forward with its increased scrutiny of the industry. These include ensuring that firms have robust cybersecurity policies in place and paying more attention to waterfall distribution calculations and end-of-fund-life issues. Going forward, the agency will focus on these themes along […]
They may not have Midtown Manhattan buildings named after them (a la the Stephen A. Schwarzman Building at the New York Public Library), or own a version of Edvard Munch’s pastel, “The Scream,” acquired four years ago for more than $100 million by Leon Black. But Alfred Gantner, Marcel Erni and Urs Wietlisbach, co-founders of Zug, Switzerland-based private markets money […]
Where should a firm focus its deal sourcing efforts? Nadim Malik and Catherine Daly of Sutton Place Strategies offer their perspective in this guest column.
The consensus regarding the arrest and charging of former Park Hill Group executive Andrew Caspersen is that the situation is not good for the private equity secondaries business. While a few sources made the point that one bad actor doesn’t implicate an entire industry, several secondary market sources say it’s especially bad for secondaries. This is because this niche strategy, in an […]