After the freeze

09 February 2009

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Last week's snowstorm brought the country to a standstill. Public transport came to a halt; workers were snowed in at home or worse - made it in and then found themselves marooned at the office. Few things were moving; none were working well

Britain in the snow is like finance during the credit crunch: everything stops. Banks stop lending, increase fees and revoke unused credit lines. Businesses cannot invest for the future and so even solvent firms face folding. Covenants, once upon a time "lite" and seemingly safe, are now regularly breached. And Baugur, once an icon of Icelandic financial might, went into administration last week as Landsbanki ended talks on restructuring its debt, putting in doubt the future of high street household names such as Karen Millen, Hamleys and House of Fraser, among others.

However, small but hopeful signs of spring are emerging, with the demise of some big names making way for nimble and innovative players. Last week alone saw a hat-trick of new firms born: Vespa Capital, a spin-off from Montagu Private Equity, reached a first close on EUR50m for its EUR100m fund for small buyouts in the UK and France; Pilot Partners has just emerged from interim recruitment specialist Ashton Penney; and Global Maritim Assets has launched as a private equity fund for shipping acquisitions.

In short, things are beginning to move, albeit slowly. Even the oft-critical Guy Hands has preached optimism for 2009 as an attractive vintage year.

By the time you read this, some of the unquote" team will be in Cape Town for the second annual unquote" South African Private Equity Congress. The event has sold out - a pleasant surprise in today's market, and indicative of investors hungry to put money to work somewhere. Our next event is 21 May for Central & Eastern Europe, to be held in London - please contact me for more information.

Yours sincerely,

Kimberly Romaine

Editor-in-chief, unquote"

Tel: +44 20 7004 7526

kimberly.romaine@incisivemedia.com.