The end of the golden age?

01 June 2008

Tweet
Facebook
LinkedIn
Google plus
Send to

People in the industry talk about 2005, 2006 and 2007 as years of splendorous wonders that brought fantastic investment opportunities with amazing returns, essentially due to easy access to debt. The credit crunch last summer has seriously cooled down investors' enthusiasm. Even if the situation is far from the cataclysm that was predicted and the industry bailed itself out rather well, things are irreparably changed. On top of market turmoil, the industry, which had promised to increase information disclosure, has been reproached for its lack of transparency

In the same fashion, private equity faces increasing criticism about low tax regimes, especially on carried interests. Tax rises are on the legislative agenda in many Western European countries and even if not all governments have yet put law projects on the table, the spotlight is on. In mid-May, the Dutch government proposed a draft legislation to increase tax on carried interest, creating one of Europes highest tax rates for the sector. Meanwhile in the UK, Prime Minister Gordon Brown has just reaffirmed his will to heighten taxes on the industry. In Germany, no bill has been formally introduced, but the matter appears in the media regularly. After all, the industry is being faced with reality: it is no longer considered a niche sector. The golden age of high leverage, low tax and high privacy, the trademarks of the industry, are long gone. What will follow only time will tell, but at least to some what is dawning is a "platinum age". Change challenges the system to become more innovative.

Just a month after announcing the launch of the electronic version of Benelux Unquote", Private Equity Insight, unquote's proprietary database, and CEPRES, the academic institute for private equity research, have teamed up to offer an integrated performance module for deal and fundraising data. This is accessible via the Private Equity Insight database; visit www.privateequityinsight.com and click on "Performance Analyser" on your left. The underlying performance data is supplied by CEPRES but within the familiar search framework of Private Equity Insight. Sign up for a free trial and please do not hesitate to contact Nicola Tillin (nicola.tillin@incisivemedia.com) or myself if you have any questions.

Yours sincerely,

Domitille Lainey

Benelux editor, unquote"

Tel: +44 20 7004 7475

domitille.lainey@incisivemedia.com.