Breakingviews

Private equity bubble hangover yields HR headache

May 11, 2012

Guy Hands will fund future bonuses at Terra Firma. The largesse is a bid to keep staff at his buyout firm, despite falling management fees and little prospect of “carried interest” on the current fund. The EMI debacle gives Terra Firma an acute case of an industry-wide problem.

Private equity patient capital gets restless

October 13, 2009

Private equity relies on long-term, so-called "patient" capital of the sort supplied by pension funds and insurance companies. This is a model that has served the industry well over the past quarter century. By locking investors in, buyout firms were able to manage investments without worrying unduly about short term performance. But it breaks down when, as now, patient capital becomes restless. The situation at French buyout firm PAI Partners shows how fraught it can become when investors fall out with their buyout firms.