Analysis

Video: Vision’s Mash discusses impact of increased holding periods

Source: unquote | 16 Sep 2013 | screening image

LPs, management teams and GPs all need to maintain motivation, says Vision Capital CEO Julian Mash.

Average holding periods have increased since the onset of the crisis, with three to five years now routinely five to seven – or more. "If you think about what's gone on in 2009-2010, it's not surprising," says Julian Mash, CEO and founder of Vision Capital. "The instinct of private equity firms (since the 2008 crash) has been to help businesses recover and that's taking longer."

Longer holding periods have implications for all parties in a fund. "It is challenging for management teams because everybody was in it together at the beginning," Mash explains. The situation can often lead to decreased morale and even less GP support as they have less funding to support older acquisitions.

"And this has an extraordinary impact on limited partners," Mash stresses. "It means they have less control over where their capital is deployed because there is a build-up of legacy assets. This constrains investment decisions."

The interview goes on to suggest ways to remotivate parties involved in such situations, with direct secondaries often able to inject fresh life into investments.

Visitor Comments

 

Add your comment

We won't publish your address
By submitting a comment you agree to abide by our Terms & Conditions

Your comment will be moderated before publication.

search unquote.com

Industry news

Cerberus in talks to buy Acciona's Transmediterránea

Vendor acquired company for €272m 12 years ago

Southern Europe unquote

| 22 Oct 2014 | secure

Advent hires new operating partner

Yu was executive board member at Evonik Industries

DACH unquote

| 22 Oct 2014 | secure

Gimv appoints new board director

De Scheemaecker succeeds Van den Driessche, who resigned earlier this year

Benelux unquote

| 22 Oct 2014 | secure

L Capital sets up shop in London

L Capital sets up shop in London

Paul Skipworth to lead London office

UK unquote

| 22 Oct 2014 | secure

Updating your subscription status Loading

People

Paul Skipworth of L Capital

Paul Skipworth to lead London office

More people news

Stephen Delaney of Bowmark Capital

Stephen Delaney, Bowmark Capital

New investment director Delaney previously Darwin Private Equity principal

More people news

Jake Warman of Sovereign Capital

Jake Warman, Sovereign Capital

Appointments follow firm's £395m fund close in August

More people news

Frederic Devos of Macquarie

Frédéric Devos, Macquarie Capital

New hire specialises in utilities and infrastructure

More people news

Barry McCaig of Pinsent Masons

Barry McCaig, Pinsent Masons

McCaig replaces Frase McMillan, who moves to firm's construction practice

More people news

Events

event

unquote" Italia Private Equity Forum

Date: 12 Nov 2014
Location: Milan, Italy
event

Forum unquote” Italia sul Private Equity

Date: 12 Nov 2014
Location: Milan, Italy

Email Alerts