Let the good times roll

But while spirits are high for the coming year, many challenges lie ahead as fiscal and legal regulations promise to change the face of the industry in significant ways. Indeed, it is likely that the EU’s proposed Alternative Investment Fund Managers (AIFM) Directive will fail to take into account the differences between the various types of “alternative investment funds”, which comes despite repeated pains by EVCA to inform the process or the efforts by the Swedish presidency to reach a compromise on the wording. As the Spanish presidency takes on the reins, the stance on the Directive remains uncertain.

Meanwhile, fundraising activity is not likely to be massive this year and will perhaps not pick up until 2011. In any case, the preparatory work building up towards future fundraising commenced last year, with GPs showing they had what it takes to grow their portfolio companies despite the difficult economy.The following step is pumping money back to investors; it is after all what GPs are being paid for.

Luckily, industry experts expect dealflow to improve in 2010 and with the progressive alignment of price expectations, who knows? We could even see the re-emergence of a few secondary buyouts. After all, given the dearth of activity experienced since the second half of 2008 in terms of both new deals as well as divestments, there are enough hungry GPs out there looking to exit investments and generate some much needed returns to their investors.

 

 

 

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• Southern Europe