Summer reveries

01 September 2009

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2009 has proven a tough year thus far. Some high-profile deals have collapsed before they could complete, as was the case of Clessidra's acquisition of a 30% stake in Cavalli; or Bain's attempt - which seemed strong - to acquire Safilo. Meanwhile, some private equity backers are struggling with their portfolio companies: Permira-backed fashion house Valentino is in the process of renegotiating its EUR2.5bn debt package, while 3i wrote its investments in nine (of 55) portfolio companies down to zero, including Italian lawnmover manufacturer Global Garden Products

Fortunately, it is not all bad news. The issue of Brussels' intended (over)regulation of private equity remains suspended until the reconvening of Parliament in the autumn. Prior to breaking for the summer, the new chairperson for the EU Parliament's economic and monetary affairs committee was appointed. This may be good news, for Sharaon Bowles, poised to oversee controversial draft EU legislation, seems more open to take in industry feedback.

Finally, Kohlberg Kravis & Roberts (KKR) is considering floating between five and six of its portfolio companies. This would mark the end of a two-year lull in the IPO markets, and others may be underway: reports suggest Virgin Active (partly owned by Permira and Bridgepoint) may be a possible candidate for flotation, alongside AA/Saga (CVC), Pets at Home (Bridgepoint), United Biscuits (Blackstone and PAI Partners) and Birds Eye (Permira).

It may just prove the reawakening we've been waiting for. Only time will tell.

Yours sincerely,

Francinia Protti-Alvarez

Editor, Southern Europe unquote"

Tel: +44 20 7004 7476

francinia.protti-alvarez@incisivemedia.com.