Questions of rent tactics by private equity

Fri, 09 May 2008, 01:11

New York Times

Private investment firms have been amassing what may seem like unusual stakes in New York real estate: they have bought hundreds of apartment buildings with thousands of rent-regulated units across the city that produce decidedly meager returns. As regulatory filings and promotional materials show, the companies expect to generate higher returns quickly by increasing rents after existing tenants vacate their units. Their success depends upon far higher vacancy rates than are typical in rent-regulated apartments in New York. Some residents and tenant advocates say that they began seeing what they consider a pattern of harassment of low-income tenants this year and suspect that it is a result of the new owners' business models.

USD1.4 billion raised for new Lime Rock private equity fund

Thu, 08 May 2008, 22:30

Blogging Buyouts

An interesting fund raise just closed today in the global energy sector. Lime Rock is a private equity firm that focuses on the global energy sector, and it announced today the closing of its fifth Lime Rock Partners fund, Lime Rock Partners V, LP, with a total USD1.4 billion in investor capital commitments. Lime Rock has four predecessor Lime Rock Partners funds, and Lime Rock Partners V will make what it calls "creative, value-adding, and long-term growth capital investments" in companies in the global energy industry.

American Capital Strategies opens second Boston office, expands sponsor finance group

Thu, 08 May 2008, 21:15

AltAssets

American Capital Strategies has opened a second office in the Boston area to expand its sponsor finance group's investment activities. The new office will be led by Tim Robinson, who the firm has appointed as a principal. In his new role, he will be joined by David Morris as vice president and Dan Hodges as associate.

Cerberus Capital is planning long-term approach to China

Thu, 08 May 2008, 20:06

Financial News

Cerberus Capital Management, the private-equity firm, is taking a gradual approach to investing in China, but also hopes to attract outbound investment from Chinese companies or funds, its chairman said. "We're taking a patient, long-term approach to China," John Snow, the former US Treasury Secretary who became Cerberus's chairman in 2006, said in an interview Wednesday. "We want to understand the investment climate... [and] we want to get known" in China before starting to invest. Other big private-equity investors have been active in China for years, such as Carlyle Group and TPG, which have done deals worth hundreds of millions of dollars.

LGV appoints Ivan Heywood as chief executive

Thu, 08 May 2008, 19:36

Alt Assets

UK mid-market buy-out firm LGV Capital has appointed Ivan Heywood as its new chief executive. Heywood will succeed Adrian Johnson, who has been chief executive of the firm since July 2000.

Sameer Gandhi joins Accel Partners

Thu, 08 May 2008, 18:08

Alt Assets

Silicon Valley venture capital firm Accel Partners has appointed former Sequoia Capital partner Sameer Gandhi as a partner in its Palo Alto office. In his new role, Gandhi will focus on the consumer internet and the software sectors, according to the firm.

The changing face of private equity

Thu, 08 May 2008, 17:07

CNNMoney

What a difference a year makes for private equity. About this time last year, the industry was inking deals at a dizzying pace and raking in massive profits, making it the hottest game on Wall Street. While private equity shops are still raising massive amounts of money, tight credit market conditions are forcing large buyout shops to rethink the business model that brought them so much success in years past.

PERE magazine unveils 30 largest private equity real estate firms

Thu, 08 May 2008, 14:53

Earth Times

The Blackstone Group and Morgan Stanley Real Estate are the two largest private equity real estate firms in the world, according to the PERE 30, a new ranking of private equity real estate firms produced by PERE magazine. Together, Blackstone and Morgan Stanley have raised more than USD36 billion in private equity real estate direct-investment capital over the past five years. In aggregate, the firms of the PERE 30 have raised more than USD190 billion in private equity real estate direct-investment capital over the same period from January 2003 to mid-April, 2008.

Survey shows SA private equity growth

Thu, 08 May 2008, 13:54

AllAfrica.com

Despite the turbulence in the global financial markets, the appetite for private equity opportunities in SA continued to grow relative to the mature markets overseas, an industry survey has revealed. The Southern African Venture Capital and Private Equity Association (Savca) and KPMG said in a survey released yesterday that private equity investment in SA grew a huge 250% to ZAR25bn last year, from ZAR7bn in 2006.

Wealthy investors favour private equity

Thu, 08 May 2008, 12:01

Euromoney Institutional Investor

Well-known high net worth individuals have benefited from putting their surpluses into private equity/venture capital funds early, reports Sify.com. Wipro chairman Azim Premji is said to have a personal fortune of over $400 million. His family office, Azim Premji Investments, manages this, channeling a portion directly into companies, both public and private, and investing some indirectly through private equity funds. Nadathur S Raghavan, co-founder and former joint managing director of Infosys Technologies (he quit Infosys in 2000), founded Nadathur Holdings to invest into and nurture early stage companies.

Carlyle ramps up activity in India

Thu, 08 May 2008, 11:24

Euromoney Institutional Investor

Carlyle Group has appointed Devinjit Singh, the former head of mergers and acquisitions in India for Citigroup, to help the Washington firm increase its presence India, The Wall Street Journal reports.
Foreign firms have said they covet the contacts and home-market knowledge of local firms, such as ICICI in India, and CDH Investments in China. India has surpassed China in terms of dollars spent so far this year, despite the tougher deal environment everywhere. Private-equity firms have invested approximately USD701.1 million there this year, down from USD1.09 billion for the same period last year, according to Thomson Reuters. In China, private equity has deployed around USD512.4 million in deals.

Columbia consortium buys GTS

Thu, 08 May 2008, 11:01

Euromoney Institutional Investor

A private equity consortium led by Columbia Capital has acquired 100% of telecom service operator GTS Central Europe from Group Menatep Limited, reports Alt Assets. Financial details of the transaction were not disclosed. The consortium also consists of M/C Venture Partners, Innova Capital, HarbourVest Partners, Oak Investment Partners, and Bessemer Venture Partners.

Leading private equity figure endorses Guernsey

Thu, 08 May 2008, 10:48

Mondaq

Guernsey is a great place to do business according to Jon Moulton, the Founder and Managing Partner of Alchemy Partners. Mr Moulton, who now lives in the Island, was the keynote speaker at the Guernsey Private Equity Funds Masterclass in London. More than 100 funds industry practitioners attended the event last Thursday which was held in The Gallery at Old Billingsgate. "I recommend any of you to use Guernsey for private equity - it works," he said.

Carlyle private equity to acquire controlling stake in Greek Neochimiki

Thu, 08 May 2008, 08:55

Forbes/Thomson Financial

Private equity fund Carlyle Group is set to acquire a controlling stake in Greek chemical company Neochimiki SA, sources close to the matter said to Thomson Financial News. The sources explained that the main shareholder, Lavrentis Lavrentiadis, and other stakeholders have agreed with the fund to sell their 67 percent stakes of Neochimiki at 19 euros per share. Carlyle is likely to de-list Neochimiki from the Athens Stock Exchange so the sources expect it will launch a public offer for the whole of the company.

Private equity firms charging more

Thu, 08 May 2008, 08:27

Financial News

Private equity firms are charging investors more for managing their investments and giving them back less of the fees they charge to their portfolio companies. With investors focusing on gaining access to the best-performing buyout funds, fee structures have shifted in favor of the private equity firms, according to the London-based research group Private Equity Intelligence (Preqin). The group's annual report on private equity's terms and conditions for funds around the world provides a benchmark for fees charged by buyout groups. The trend is that the top end of the industry is making more from management fees than it was four years ago despite investor unease over fund terms and fee arrangements.