Of timing and opportunity

10 March 2009

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The market has ground to a halt. In the UK, deal flow has almost halved from a year ago to just 20-25 deals a month nowadays. But this hides the fact that a strong undercurrent lies beneath. Everyone is busy, trimming down costs, refinancing, reorganising; whatever it takes to cut losses (see cover)

In the meantime, advisers are busy looking at alternative sourcing opportunities. A major source of potential dealflow is said to be the public markets, though a recent survey revealed that roughly half of UK quoted companies would be "suspicious" of a take-private approach by a private equity firm. The results are from a study conducted by BDO Stoy Hayward of 86 listed firms with a market value of between £15-250m, and measures the attitude of fund managers, private equity and quoted companies towards public-to-private transactions.

Others are speaking of opportunities arising from the sale of non-core assets by distressed parents, distressed assets (or debt) and infrastructure. A few funds are out raising for the latter, with Blackstone Group in pre-marketing for a $3-5bn infrastructure fund; Macquarie on the road for two funds (Macquarie Infrastructure Partners II ($6bn) and Macquarie European Infrastructure Partners III (EUR5bn)); and Santander in Spain is seeking EUR1.5bn for infrastructure.

While many know that the best deals are made in a downturn, few are willing to call the bottom of the market. Timing is everything but apprehension is in the air. Opportunity may be knocking for a bit longer than usual.

Yours sincerely,

Francinia Protti-Alvarez

Editor, Benelux unquote"

Tel: +44 20 7004 7475

Francinia.protti-alvarez@incisivemedia.com.