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Private Equity—2023 Outlook

Harvard Corporate Governance

private equity showed resilience in 2022. And while private equity continues to face headwinds in 2023, market dislocations often provide compelling opportunities for the most thoughtful and sophisticated investors. We review below some of the key themes that drove private equity deal activity in 2022 and our expectations for 2023. Announced global private equity M&A deal volume declined from $2.1

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Corporate Racial Equity Tracker

Harvard Corporate Governance

Posted by Kavya Vaghul and Ashley Marchand Orme, JUST Capital, on Monday, June 20, 2022 Editor's Note: Kavya Vaghul is Senior Director of Research and Ashley Marchand Orme is Director of Corporate Equity at JUST Capital. Pay Equity.

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The Market for CEOs: Evidence from Private Equity

Harvard Corporate Governance

A wide range of research examines the market for CEOs and executive mobility in public companies while largely ignoring the market for CEOs in private equity funded companies. companies (enterprise value greater than $1 billion) purchased by private equity firms between 2010 and 2016. We find that 71% of those companies hired new CEOs under private equity ownership. times on its equity investment. Posted by Paul A. Gompers (Harvard Business School), Steven N.

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IPO Readiness: IPO Equity Awards

Harvard Corporate Governance

This article focuses on understanding practices related to equity awards made at or around IPO. Granting IPO awards can be beneficial to the company, equity recipients, and the new broader shareholder base.

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CEO alpha: A new approach to generating private equity outperformance

Mckinsey and Company

To create and sustain high performance, private equity sponsors must make building distinctive PE CEOs a priority. Insights on Private Equity & Principal Investors Private Equity

Alpha 97
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The Corporate Calendar and the Timing of Share Repurchases and Equity Compensation

Harvard Corporate Governance

Wang (discussed on the Forum here ); and Share Repurchases, Equity Issuances, and the Optimal Design of Executive Pay by Jesse M. 2013 ) and specifically the CEO ( Moore, 2020 ) are more likely to sell equity when firms buy back stock.

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Benefits of Selling to a Private Equity Group

Viking Mergers

To some, the topic of selling to private equity groups does not stir positive feelings. What is a Private Equity Group? Private equity is often lumped into a single category of leveraged buyouts , which has played a large role in the negative reputation.

Equity 130
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Why Growth is Important to Private Equity

Business Sales M&A

One of the main premises behind a Private Equity Group (PEG) acquisition is to use debt to amplify the returns on the equity portion of it. Articles Business Valuations Exit Planning Mergers and Acquisitions Posts business valuations EBITDA multiple private equity valuation multiples

Equity 130
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The state of diversity in US private equity

Mckinsey and Company

Taking a closer look at the data reveals private equity’s progress, remaining challenges, and the road ahead on diversity. Insights on Private Equity & Principal Investors Private Equity

Equity 114
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Data Update 2 for 2023: A Rocky Year for Equities!

Musings on Markets

In this post, I will begin by chronicling the damage done to equities during 2022, before putting the year in historical context, and then examine how developments during the year have affected expectations for the future. Actual Returns Your returns on equities come in one of two forms.

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Surge in Private Equity Deal Activity 2021

Benchmark Report

Private equity transactions on a global scale returned to form in 2021 following the challenges posed by the pandemic, with private equity firms deploying record amounts of dry powder held as they looked to invest cash accumulated during the pandemic.

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Liability for Non-Disclosure in Equity Financing

Harvard Corporate Governance

Notably, the damage payment received by the outside investors is offset in part by the reduced value of their equity stake. Posted by Albert H. Choi (University of Michigan) and Kathryn E. Spier (Harvard Law School), on Friday, April 22, 2022 Editor's Note: Albert H. Choi is Paul G. Kauper Professor of Law at the University of Michigan and Kathryn E. Spier is Domenico De Sole Professor of Law at Harvard Law School. This post is based on their recent paper.

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Tracking diversity, equity, and inclusion data in private markets

Mckinsey and Company

Institutional investors and private equity firms can implement some basic but crucial best practices to measure progress on diversity, equity, and inclusion. Insights on Private Equity & Principal Investors Institutional investors Financial Services Diversity

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Private equity considerations from the SEC’s climate proposal

Harvard Corporate Governance

Investment in environmental, social and governance (ESG) factors is a top priority for private equity, and it has been for quite some time. In fact, 72% of large private equity firms with annual revenues of $50 million to $1 billion have incorporated ESG strategies into their portfolio of asset classes. [2]. public issuers at the forefront, the proposal has powerful implications for private equity firms, and it is time to prepare.

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When Private Equity Came for the Toddler Gyms

NYT M&A

Mergers, Acquisitions and Divestitures Private Equity Suits and Litigation (Civil) Children and Childhood Gymnastics Little Gym, The Unleashed Brands Franchises

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Diversity, Equity and Inclusion Lighthouses 2023

Mckinsey and Company

Leaders need clarity on what works to improve diversity, equity, and inclusion. Our 2023 report shows success factors that contributed to significant, quantifiable, scalable, and sustainable DEI impact. Diversity and Inclusion Diversity Leadership Strategy Organization

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Thomas Lee, Private Equity Pioneer, Is Dead at 78

NYT M&A

Lee, Thomas H Private Equity Mergers, Acquisitions and Divestitures Lee, Thomas H, Partners Snapple Beverage CorpThe financier, who called himself Tomcat, was an early buyout enthusiast.

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Why private equity sees life and annuities as an enticing form of permanent capital

Mckinsey and Company

Insights on Private Equity & Principal Investors Private Equity Life insurancePrivate acquisitions of in-force books are growing. Here’s a playbook for those considering market entry, those already in, and insurers wondering how to respond.

Equity 124
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The Kroger-Albertsons Merger Spotlights a Popular Private Equity Tactic

NYT M&A

saturdaynewsletter Private Equity Mergers, Acquisitions and Divestitures Albertsons Inc Kroger CompanyAlbertsons wants to pay $4 billion to shareholders ahead of its proposed merger with Kroger, a move that would require the already debt-ridden company to borrow $1.5 billion.

Equity 89
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Forging your own path: Sandra Horbach on building a career in private equity

Mckinsey and Company

The cohead of US buyout and growth at Carlyle shares thoughts on the state of private equity, the path forward on diversity and inclusion, and advice on building a successful career in the industry. Insights on Private Equity & Principal Investors Private Equity Women & Leadership

Equity 118
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The Law and Economics of Equity Swap Disclosure

Harvard Corporate Governance

This post is based on his recent paper, The Law and Economics of Equity Swap Disclosure , which is in turn based on a comment letter he filed with the Securities and Exchange Commission in response to a request for comments on its proposal regarding the disclosure of equity swaps. In my paper The Law and Economics of Equity Swap Disclosure , and in a comment letter I filed with the Commission, I provide a critical assessment of this proposal. Posted by Lucian A.

Equity 160
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Private Equity Firm Buys Embattled Pornhub Parent

Law 360 M&A

Private equity firm Ethical Capital Partners said Thursday it would purchase MindGeek, a controversial media company with a large portfolio of adult entertainment properties, including Pornhub

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Private Equity Exit Opportunities: How to Check Out of Hotel California

Brian DeChesare

Your first thoughts reading this article might be, “Wait a minute, why are ‘private equity exit opportunities’ a topic? But despite the hype, people do leave private equity all the time, whether it’s voluntary or forced. Why Leave Private Equity? Private Equity - Careers

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Generational Equity Advises Oceanwide Repair in its Recapitalization with Fletch Equity

Business Wire M&A

DALLAS--(BUSINESS WIRE)--Oceanwide Repair, a Generational Equity client, was recapitalized by Fletch Equity

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Private equity leans into the SVB wreckage

Financial Times M&A

Plus, Wirecard’s hard-partying executive on trial

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Pornhub owner MindGeek sold to private equity firm

The Guardian M&A

Buyer Ethical Capital Partners targets industries requiring ‘principled ethical leadership’ The company behind the website Pornhub, which has been accused of hosting illegal content, has been sold to a Canadian private equity firm for an undisclosed sum. Mergers and acquisitions Business Pornography Private equity Canada

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EQT Private Equity Completes Acquisition of Billtrust

Business Wire M&A

announced the completion of its acquisition by the EQT X fund (“EQT Private Equity”), part of EQT LAWRENCEVILLE, N.J.--(BUSINESS BUSINESS WIRE)--BTRS Holdings Inc.

Equity 98
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ISS Updates Frequently Asked Questions for Equity Compensation Plans, Peer Group Selection and Compensation Policies

Harvard Corporate Governance

ISS recently issued Frequently Asked Questions (FAQs) documents related to equity compensation plans, the peer group selection methodology and issuer submission process, and compensation policies.

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Benchmark International’s Transaction of KGM Wins Private Equity Deal Of The Year For The Americas

Benchmark Report

Louis-based private equity firm Compass Group Equity Partners. The coveted "Private Equity Deal of the Year for the Americas" was awarded at this month's 14th Annual M&A Americas Atlas Awards at Manhattan's Metropolitan Club.

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Chief performance officers can be a secret ingredient for private equity success. Here’s why

Mckinsey and Company

Operating groups gain an edge when they add a CPO, but these roles are still rare in private equity firms. Insights on Private Equity & Principal Investors Private Equity Corporate FinanceThat should change.

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2022 Proxy Season Review: Say-on-Pay and Equity Compensation Plan Voting

Harvard Corporate Governance

ISS Say-on-Pay and Equity Compensation Plan Voting. Posted by Jeannette Bander, Heather Coleman, and Marc Treviño, Sullivan & Cromwell LLP, on Monday, September 12, 2022 Editor's Note: Jeannette Bander , Heather Coleman , and Marc Treviño are partners at Sullivan & Cromwell LLP. This post is based on a Sullivan & Cromwell memorandum by Ms. Bander, Ms. Coleman, Mr. Treviño, June Hu , Brittney Kidwell, and Rebecca Rabinowitz. Introduction.

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Health equity: Activating meaningful change

Mckinsey and Company

The COVID-19 pandemic has highlighted longstanding health and social inequities in healthcare and raised the urgent question of how health equity can be achieved.

Equity 104
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Cannabis Licensing: Will New York's Social Equity Model Set The Trend Or Get Tripped Up?

Benzinga

Several states that have recently or soon intend to roll out their adult-use cannabis marketplaces hope progressive equity licensing measures pay off, unlike the states before them. Part of the anticipated booming economy will be equity license holders.

Equity 98
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Toshiba approves $15bn buyout offer from Japanese private equity fund

Financial Times M&A

Sale of struggling conglomerate would be country’s largest take-private deal

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Private Equity Is the New Financial Supermarket

NYT M&A

Private-equity firms were once niche players serving big clients. Private Equity Banking and Financial Institutions Regulation and Deregulation of Industry Mergers, Acquisitions and Divestitures Blackstone Group, The Apollo Global Management Carlyle Group LP TPG Capital KKR & Co LP

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Governance and the Decoupling of Debt and Equity: The SEC Moves

Harvard Corporate Governance

Decoupling”—the unbundling of the rights and obligations of equity and debt through derivatives and other means—has posed unique challenges for corporate and debt governance. Posted by Henry T. Hu (University of Texas), on Tuesday, November 8, 2022 Editor's Note: Henry T. Hu is the Allan Shivers Chair in the Law of Banking and Finance at the University of Texas Law School.

Equity 161
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Advancing diversity, equity, and inclusion

Mckinsey and Company

During the COVID-19 pandemic, women have had bigger workloads—and have burned out in greater numbers. Government leaders can use proven approaches to address these issues and build better workplaces. Public & Social Sector Insights Public & Social Sector

Equity 126
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SocGen and AllianceBernstein agree equities merger

Financial Times M&A

French bank will have option of buying joint venture outright five years after it launches

Banking 91
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Private Equity: Why an integrated ecosystem is a must have

Avanade

Remaining ahead of the curve and being flexible isn't always easy for private equity firms but efficient, lean & integrated technology choices can help.

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Fannie’s ‘Equity’ Plan: The Drinking Game

Appraisers Blog

What makes equity so invidious as a governing tenet is that it involves not just helping people of one racial or cultural group but it has the effect of knocking struggling members of disfavored groups out of the game.

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Dispelling Myths about Private Equity Buyers

Benchmark Report

Private Equity buyers will come in and get rid of all of my employees, borrow an absurd amount of money to finance the acquisition, thereby straining my company’s balance sheet and income statement, and then, light a match Goodfellas-style when they are done extracting value from it.

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What Is Cost of Equity?

Andrew Stolz

Definition of the Cost of Equity. The theoretical return the firm pays its equity investors (shareholders) is known as the cost of equity. In other words, the cost of equity is the rate of returns a firm pays to its shareholders. What Impacts the Cost of Equity?

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What Is Equity Risk Premium?

Andrew Stolz

Definition of Equity Risk Premium. What Impacts the Equity Risk Premium? How Do You Calculate Equity Risk Premium? Equity risk premium can be calculated by subtracting the expected risk-free rate from the market expected return. Why is the Equity Risk Premium Important?