Fireside chat on global private equity: challenges and opportunities

Euan Rellie, BDA Co-Founder and Senior Managing Director based in New York, recently joined a unique fireside chat with three global private equity firms and the largest & most active global PE legal practice.

Panelists:

Euan Rellie, Co-Founder and Senior Managing Director, BDA Partners
Duncan Enista, Partner, Kirkland & Ellis
Andre Puong, Partner, Cathay Capital
Joanne Yoo, Managing Director, DPI
Bob Landis, Founding Partner (Origination), Riverside Company
Moderated by Jordan Selleck, CEO & Co-Founder, 51 Labs

Here are some of the key takeaways. Check out the full video for more detailed insights.

Global buyout transactions fell 60% from January to April and transaction volume is now trending around 1/3 of the five-year monthly average
Uncertainty in the US is hampering deal flow relative to other markets
Deals are getting done, but largely for add-ons and platforms known pre-COVID
Earn-outs: Not seeing a significant uptick in earn-outs; however, Duncan is seeing them as a way to get sellers back to the table when the valuations weren’t what they had hoped for during the lockdown
Hong Kong: The mood is bleak, according to Euan Rellie, Senior Managing Director at BDA. Firms are moving out and there’s a feeling that it’s quickly becoming less of the multinational hub that attracted people for decades. In the short term, tying Hong Kong closer to China might not be all bad. For example, Chinese companies which may have be reluctant to do IPOs in Western markets might favor listing in Hong Kong
China: Doing cross-border deals with China is more difficult now. Today, you have competitive local brands that are going to eat your lunch if you’re not extremely aggressive and localized. You can’t use the playbook of 20 years ago
Africa: Joanne Yoo, Managing Director at DPI, made it clear that Africa is not as connected to the rest of the world so the pandemic hit later and caused less damage. DPI’s deal activity is actually busier than before. Their portfolio companies have largely been deemed as essential businesses, and like many lower/mid-market company in Africa, they hold more inventory than other markets
What impact will the upcoming US election have on their business and strategies, based on a scale of 1-5? Joanne 2, Bob 3, Andre 3, Duncan 2, Euan 2

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About BDA Partners

BDA Partners is the global investment banking advisor for Asia. We are a premium provider of Asia-related advice to sophisticated clients globally, with over 24 years’ experience advising on cross-border M&A, capital raising, and financial restructuring. We provide global reach with our teams in New York and London, and true regional depth through our seven Asian offices in Mumbai, Singapore, Ho Chi Minh City, Hong Kong, Shanghai, Seoul and Tokyo. BDA has deep expertise in the Chemicals, Consumer & Retail, Health, Industrials, Services and Technology sectors. We work relentlessly to earn our clients’ trust by delivering insightful advice and outstanding outcomes.

BDA Partners has strategic partnerships with William Blair, a premier global investment banking business, and with DBJ (Development Bank of Japan), a Japanese government-owned bank with US$150bn of assets.

US securities transactions are performed by BDA Partners’ affiliate, BDA Advisors Inc., a broker-dealer registered with the Securities and Exchange Commission (SEC). BDA Advisors Inc. is a member of the Financial Industry Regulatory Authority (FINRA) and SIPC. In the UK, BDA Partners is authorised and regulated by the Financial Conduct Authority (FCA). In Hong Kong, BDA Partners (HK) Ltd. is licensed and regulated by the Securities & Futures Commission (SFC) to conduct Type 1 and Type 4 regulated activities to professional investors. www.bdapartners.com