January 26, 2009
HEC alumni Jérôme Girszyn and Laurent Savinelli, two partners in 3i’s Paris office, have left the firm. Savinelli has managed the Growth Capital and SMBO team in France since 2002. He started his career as a financial analyst at stockbroker Oddo-Pinatton in 1989 before joining 3i in 1994. Girszyn joined 3i’s Paris office in 1998 from Arthur Andersen Corporate Recovery. He was appointed head of the portfolio team in 2000 and partner in 2003.
In somewhat related news, the head of 3i, Philip Yea, hinted at the possibility of raising a growth capital fun, along with repeating the mantra that cash is king.
December 3, 2008
Ok, so the industry has had layoffs before (for VC there was a wave of firms downsizing after the dotcom bubble burst in the early 2000’s, etc.) but for buyout houses the coming months may see some historic scaling back of personnel. First up there’s American Capital cutting 19% of it’s workforce which should total about 110 people across it’s US and European offices. 3i is trimming 15% of it’ workforce, which represents over 100 individuals. Now, the Carlyle Group has just announced that they are paring back about 100 jobs, or 10% of its work force, citing “extraordinary market conditions.” This move that is seen as a step to get the firm back to it’s early 2007 personnel levels. In all cases the majority of the layoffs are coming from the backoffice (HR, Legal, Accounting, etc.), but not all.
Private Equity has often been cited as a possible substitution for traditional I-Banking. Forgetting that debate for now, it’s still interesting to point out Private Equity’s quick learning of the I-Banking binge-and-purge HR policies. Talk to any recruiter over the second half of 2007/first half of 2008 and they would have openly expressed dismay at the fact that buyout shops were still recruiting and hiring. Now the reality of the situation has hit home and the firms are looking to shed some of the dead weight that is sitting idle until the debt markets return (Buyout houses won’t start making deals in high numbers again until the leverage returns. It’s much harder to break a hurdle rate without gearing). Until then the employment numbers in the business will contract.
On a side note I’m graduating at the end of this month. God did I time this market wrong. Oh well.
It’ll all work out. It’ll all work out.
September 14, 2008
Following up to my last post, I thought I’d also include the video from the Open Forum Davos panel entitled “Private Equity & Hedge Funds – Friend or Foe?” The talk, also from January of this year, featured Christian Levrat, Member of the Swiss Parliament; Hans Ruh, former professor of Theology and Social Ethics and current president of Blue Value; Philip Yea, Chief Executive, 3i Group; Paul Fletcher, Senior Managing Partner, Actis Capital; and moderated by Dirk Schutz, Editor-in-chief of Bilanz.
July 24, 2008
Following up my comment from yesterday that minority stakes in firms are a bit more common on this side of the Atlantic, there’s another example that growth capital deals are alive and well in Europe as the firm formerly known as Investors in Industry (that’s 3i for everyone following along) is leading a 200M euro investment in pan-European medical diagnostics firm, Labco. 3i is in for 140M euros, with TCR Capital, Natixis Investment Partners, and CIC Finance picking up the remaining 60M euros. The deal furthers 3i’s emphasis on healthcare which in Europe is run by Denis Ribon (who is a 1999 graduate of HEC’s MBA program, i.e. he’s one of the good guys!), who will assume a seat on Labco’s board.
As those European businesses that have emerged as “national champions” look to expand beyond their home markets and enter the global playing field, growth capital deals will become ever more essential in enabling those firms to become capable of doing so with the proper resources and know-how. Not only do the firms that are invested in receive much-needed capital but they also gain the value added that the private equity firms bring in terms of network and experience in the era of mondialisation. Definitely a niche of the private equity spectrum to place close attention to!