Queen abdicates, predicts "new peak" for PE

The surprise announcement that the head of Europe's oldest investor is leaving came as a shock to some, while others cite ongoing issues within the firm as another sign that 3i is in wind-down mode - in Britain, at least.

This rumour casts doubt over the longevity of the industry in its current guise, but Queen's two and a half decades have left him extremely optimistic:

"I'm more positive than I've ever been. Pension funds and insurance companies are struggling to produce returns. I'm convinced by what I've seen in the last 25 years that private equity generates superior returns. It's had a tough few years recently, but it'll come back again and hit even new peaks. It really is a phenomenal industry."

The last few years have been particularly difficult, not least for 3i, which was among a small few not to secure an extension to the investment period on its latest fund. But Queen feels the firm may be at a turning point:

"3i is in a very strong position in all three of the areas in which it operates (PE, infrastructure and debt). We've undergone a three-year turnaround and the firm is now stabilised and can move ahead strongly. I felt it was therefore time for me to inform the shareholders I'd be moving on."

Indeed, unquote" has recorded 10 departures of executive staff over the past 12 months, making the firm appear weakened by economic conditions.

But this might just be a sign of re-adjustment. As the European market is struggling under enormous economic pressures, 3i has set up a new team in Brazil to focus on investments in emerging markets. Marcelo Di Lorenzo, who joined the firm in April 2009, will head the team.

3i is currently in the process of recruiting a new chief executive. Queen's departure from the London office could pave the way for Simon Borrows, who has joined the firm as CIO from Greenhill. Other recent senior hires include Jeremy Ghose and Rob Reynolds, who joined from Mizuho Investment Management and Resource Europe respectively.

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