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Tag Archives: private equity

Private Equity Market Study, Seventh Edition

By David J. Walker, Tom D. Evans, and Catherine Campbell Current Trends The M&A market is constantly evolving — from the predominantly seller’s market of H2 2019, to the tumultuous times of H1 2020, dynamics are shifting. Deal terms vary by transaction size, industry sector, and jurisdiction. Having a thorough knowledge of market trends is … Continue Reading

Earnouts Are Rising Across Europe, But Can They Unlock COVID-19 Valuation Gaps?

Despite practical challenges, earnouts are a tool that PE buyers should increasingly consider to reconcile differences and get deals done. By Alexander Benedetti, Giancarlo D’Ambrosio, Sebastian Pauls, Laura Kichenside, Catherine Campbell, Tom Evans, and David Walker The use of earnouts, though historically disliked by PE buyers, is increasing across Europe. Earnouts can provide a way … Continue Reading

Transacting With Troubled Companies – 3 Tips for PE Deal Teams Navigating Stressed, Distressed, and Insolvent Acquisitions

Successfully executing an acquisition from stress, distress, or insolvency requires a creative approach to reconcile competing interests. By Simon Baskerville, Jack Isaacs, Hyo Joo Kim, Catherine Campbell, Tom Evans, and David Walker The COVID-19 pandemic has brought a heightened risk of financial difficulty and insolvency for companies. Whilst there have been relatively few formal insolvencies … Continue Reading

PE Can Pursue PIPE Dreams

European PIPEs — which have experienced an uptick due to COVID-19-related market volatility — present unique structural, informational, and governance considerations for private equity investors. By Richard Butterwick, Chris Horton, Tobias Larisch, Harald Selzner, Anna Ngo, Hector Sants, Catherine Campbell, Tom Evans, and David Walker European private investments in public equity (PIPEs) have historically been … Continue Reading

Foreign Investment Controls — Are We Seeing a More Nuanced Approach to Private Equity?

Amid FDI screening regime expansion, deal teams have opportunities to capitalise on newly available exemptions, but must beware novel complexities. By Jonathan Parker, Rachel K. Alpert, Stephanie Adams, Gillian Bourke, Zachary N. Eddington, Catherine Campbell, Tom Evans, and David Walker US intervention in the proposed acquisition of hotel-software company StayNTouch by a Chinese investor and … Continue Reading

Scoring on Sports Deals

Buyout firms must beware the unique legal, regulatory, and commercial issues that can complicate sports transactions and impact returns. By Patrick Mitchell, Alex McCarney, Stewart Robinson, Catherine Campbell, Tom Evans, and David Walker Private equity interest in sports assets has grown over the last few years, with investments in teams, leagues, and other members of … Continue Reading

The Lipstick Effect — Are Kylie Jenner and New Technologies Making Beauty Deals Increasingly Attractive for Private Equity?

Digital due diligence becomes increasingly important when buying digitally native beauty brands. By Deborah J. Kirk, Linzi Thomas, Camilla J. Dutton, Laura Kichenside, Catherine Campbell, Tom Evans, and David Walker Recent high-profile beauty M&A deals, coupled with current economic uncertainty, have brought renewed interest in the “lipstick effect”. Much cited in the aftermath of the … Continue Reading

Navigating M&A in 2019 — How Deal Terms Are Responding to the Current M&A Market

Drawing on Latham’s Sixth Private M&A Market Study, we explore trends and developments in consideration mechanics and deal conditionality. Richard Butterwick, Martin Saywell, Simon J. Tysoe, Catherine Campbell, and Richard George Uncertainty has been a significant market factor in 2019. The UK’s decision to leave the European Union, protectionist responses to China as a global investor, … Continue Reading

Will the Increase in Cross-Channel Deals Require an Anglo-French Approach to Management Equity?

As management terms converge, deal teams must still navigate cross-border differences in ratchets, put and call options, and management warranties. By Alexander Benedetti, Tom Evans, David Walker, Neil Campbell, Catherine Campbell, and Eric Loubet French and UK private equity firms are increasingly looking across the Channel for attractive buyout opportunities. Cross-border transactions involving French and UK … Continue Reading

4 Key Reasons Why European P2P Deals Fail – and How Private Equity Deal Teams Can Avoid Them

Adherence to secrecy, pre-announcement preparations, realistic expectations-setting, and strategic plans for taking control are keys to P2P deal success. By Richard Butterwick, Pierre-Louis Clero, Manuel Deo, Tom D. Evans, Tobias Larisch, David J. Walker, Suneel Basson-Bhatoa, Phillippe Tesson, Connor Cahalane, and Catherine Campbell The deal market has seen a resurgence in public to private (P2P) transactions … Continue Reading

Big-Ticket Fines and Veil-Piercing Cases Raise Portfolio Company Liability Risks for PE Parents

How can private equity firms identify and mitigate inherited liability risk from vulnerable portfolio companies? By Tom Evans, Gail Crawford, Fiona Maclean, David Walker, Katie Peek, Catherine Campbell, and Amy Smyth Ongoing big ticket regulatory fines coupled with high profile corporate veil cases indicate that private equity deal teams must remain alert to the risk of … Continue Reading

Private Equity in Japan: With Opportunities Come Continuing Challenges

Firms targeting assets divested by conglomerates still face obstacles, though barriers to PE investment in Japan are gradually falling. By Stuart Beraha, Noah Carr, Tom Evans, Hiroki Kobayashi, Ivan Smallwood, David Walker, and Catherine Campbell  Many hurdles that traditionally challenged private equity firms looking to invest in Japan have been lowered in recent years. The Japanese … Continue Reading

Private Equity Set to Get Active With Activists

Companies previously considered immune from activist campaigns have come under pressure, driving new public and private deal opportunities for private equity. By Richard Butterwick, Christopher Drewry, Tom Evans, Harald Selzner, David Walker, Ben Coleman, and Catherine Campbell US shareholder activists are an established presence in Europe. In 2018, activist campaigns targeted 160 European companies, according to Activist Insight. In … Continue Reading

2019 Is Different From 2008: 4 European Restructuring Developments for Private Equity Firms to Consider

Persisting political and economic uncertainty means awareness of market changes remains crucial. By Simon Baskerville, Tom Evans, David Walker, Stephanie Dellosa, and Catherine Campbell The 2008 distress cycle triggered defaults and restructurings for European PE portfolio companies, as maintenance covenant defaults and balance sheet deleveraging forced refinancings and debt-for-equity swaps. While restructuring conditions for PE firms are … Continue Reading

Cornerstone Investments: A Foundation for Private Equity-Sponsored IPO Exits

Cornerstone investments can assist a firm’s overall exit objective, particularly when there are bidders for a portfolio company but no outright buyer. By James Inness, Tom Evans, David Walker, Sonica Tolani, Connor Cahalane, and Catherine Campbell Cornerstone investments, which involve taking a stake in an about-to-list company, have been popular in Asia and in Nordic countries for … Continue Reading

Is Artificial Intelligence Set to Transform Private Equity Dealmaking?

With the explosion of AI applications, private equity houses and their portfolio companies must understand where key opportunities lie. By Tom Evans, Kem Ihenacho, David Walker, Laura Holden, Hector Sants, Claudia Sousa, Catherine Campbell, and Patricia Kelly Artificial intelligence (AI) developments provide increasing opportunities for private equity, including deal sourcing and portfolio company analysis/enhancement, particularly in businesses that can adopt … Continue Reading

5 Antitrust Trends for Private Equity to Watch

We examine: increasing focus on non-controlling stakes, burdensome document production requests, heightened enforcement of gun jumping rules, examination of vertical deal overlaps, and ongoing political developments. By John Colahan, Peter Citron, Calum Warren, David Walker, Tom Evans, and Catherine Campbell In a continually evolving antitrust landscape, we consider five key trends that PE deal teams … Continue Reading

Are Private Equity Bank Buyouts Set to Soar?

European regulators’ openness to PE investors is presenting attractive banking sector opportunities, but such opportunities require careful regulatory planning and local issue navigation. By Carl Fernandes, Hans-Jürgen Luett, David Walker, Tom Evans, and Catherine Campbell Ten years ago, a PE investment in a European bank would have been a rare occurrence. However, more recently, PE … Continue Reading

Litigation Funding: Private Equity Investment Opportunity and Portfolio Risk Management Tool

As litigation funders find new disputes markets, PE firms should consider litigation funding as a growth sector — and as a valuable tool for de-risking portfolio company claims. By Stuart Alford, Dan Smith, David Walker, Tom Evans, and Catherine Campbell Litigation funding, the third-party financing of legal costs in disputes, is increasingly common in the … Continue Reading

Will Regulatory Reform Make Cryptoassets the Next Buyout Boom for Private Equity?

Regulatory guidance on cryptoassets and digital currency companies may lead to a legitimisation of crypto-businesses as an investable asset class. By Stuart Davis, Sam Maxson, David Walker, Tom Evans, and Catherine Campbell Recent and upcoming regulatory guidance on cryptoassets and the regulation of companies engaged in digital currency, such as issuers, crypto-exchanges, crypto-custodians, crypto-brokers, and … Continue Reading

Addressing Pensions Liabilities for Underperforming Portfolio Companies

By Catherine Drinnan and Shaun Thompson This year has seen a significant number of business failures, particularly on the high street, as businesses have struggled in the face of market fragility and Brexit uncertainty. When a UK portfolio company is underperforming, the presence of a defined benefit pension (DB) plan with a large deficit can … Continue Reading

Private Equity Buyers Poised to Reap W&I Insurance Benefits

By Drew Levin, Maarten Overmars, and Catherine Campbell Warranty and indemnity insurance (W&I) has become a common feature of European transactions in recent years, amid a strong sellers’ market that has enabled vendors to offload risk to buyers. According to the most recent edition of the Latham & Watkins Private M&A Market Study, which examined … Continue Reading

Growth of Large-Cap Consortium Bids Tests Popularity of Proprietary Bids — but What Are the Challenges for Private Equity?

By Suneel Basson-Bhatoa, Alex McCarney, and Catherine Campbell Consortium (or “club”) deals involving PE firms have become a common feature of the deal market throughout 2018, with sponsors teaming up with each other or with strategic partners to buy large-cap assets. To the start of November 2018, 20 consortium transactions worth more than US$1 billion … Continue Reading

Outsource Service Providers to the Financial Services Industry — A Growth Sector for Buyout Firms

By Nicola Higgs, Fiona MacLean, Brett Carr, and Catherine Campbell Technology outsourcing by financial institutions (FIs) has increased in recent years as FIs look to the latest innovations to improve their day-to-day business processes and to reduce costs. FIs outsource key functions to a host of regulated and unregulated third-party service providers, and the sector is … Continue Reading
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