The Converteam buyout effect

In France, the private equity world is still currently debating its role in the wake of the Converteam deal. Barclays Private Equity France's partial exit of the power conversions company is the largest buyout so far this year and is valued at just over EUR1.9bn.

LBO France has taken a third of the company alongside the management, who took the remaining third by reinvesting most of the EUR700m plus-value generated. Barclays PE originally purchased the company from Alstom in November 2005 in an MBO deal worth only EUR150m.

The issues raised by the deal concern the reallocation of these astounding returns, which had not initially benefitted the company employees, resulting in a call to spread returns more equally throughout private equity acquired companies. (Page 10)

AXA Private Equity, one of the most prominent participants of the debate has for it's part had a very active month demonstrating its flexibility by recording two exits deals, a PIPE and a buyout.

Meanwhile, this month also saw another large buyout with 3i leading a EUR728m investment for a minority stake in Labco. Also investing was TCR Capital, Natixis Investment Partners and CIC Finance along with the management team and private individuals.

Labco offers medical diagnostic services to patients, general practitioners and hospitals via its network of 250 labs across six countries.

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