tag:blogger.com,1999:blog-21724748.post6675761994189262200..comments2023-09-26T15:14:50.352+01:00Comments on Conservative Party Reptile: Private Equity: efficiency, system, economyTim Jhttp://www.blogger.com/profile/03705980028580424584noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-21724748.post-76514968597500548452007-02-28T11:21:00.000+00:002007-02-28T11:21:00.000+00:00Floreat,I need to be careful what I reveal, but we...Floreat,<BR/><BR/>I need to be careful what I reveal, but we have just sold part of our business to a leading PE firm. They are neither as bad nor as good as people say. They are not the devil incarnate, or we would not have put our former employees in that position. They undoubtedly do bring some useful disciplines and capabilities. But they will be most dependent for increasing the value of their assets on riding a wave of market perception, rather than on the marginal operational improvements. They may well have spotted a trend and by agglomerating assets in that sector will profit when people value the whole as more than the sum of its parts. And good luck to them if they do. <BR/><BR/>On the downside, they undoubtedly are short-termist in their outlook, which may help to drive up the value of the company quickly for a sale or float, but will leave the company with problems in the longer-term. But <I>caveat emptor</I>. It's their business to run how they see fit. And it's investors' money to waste when the business is sold, if they choose to ignore the likely consequences of the short-termist management. <BR/><BR/>We don't need more control of PE, but more wisdom in the valuation of their offerings, and that is not something that can be mandated, only allowed to evolve with experience.Anonymousnoreply@blogger.com