French companies smarten up for potential investors

Management teams in French target companies are starting to hire their own financial advisors to make themselves more attractive to private equity bidders. Dominique Gaillard, a member of the executive committee of AXA Private Equity, said executives were increasingly negotiating with potential acquirers over which terms a targeted company's management team would use to back a particular offer. Gaillard said that France was increasingly adopting UK and US practices, usually after a lapse of 20 months. Another practice taking off in France is vendor due diligence. This reduces the time and effort required to be expanded by potential bidders, aiming to make the disposal process more efficient for the seller. Kohlberg Kravis Roberts, Electra Partners and Cinven are among a number of large firms expected to raise new funds in the coming months. Dominique Sénéquier, chief executive of AXA Private Equity, pointed out that investors are becoming increasingly demanding: 'Clients are less comfortable with funds that lack transparency. Some of them even want to meet the chief executives of companies we invest in.'

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