Thursday, 14 June 2007
Private equity's first casualties
After the mauling the BVCA got at the select committee evidence session this week, it's no surprise to see that head of the organisation has been drop-kicked. Officially he has stood down, but there are few doubts that he was given a major shove, rather than jumping himself. As the Torygraph opines, this is a bad time for the trade body to lose its leader.
Notably the CBI is now sniffing around the buyout firms. Undoubtedly the CBI could do a much better job of lobbying on behalf of the industry (it would be pretty hard to do a worse job). But I wonder if it is really a sensible move on the part of the CBI. The unions have successfully created a popular image of private equity as super-rich robber barons, does the CBI really want to be associating itself with that?
Casualty number two is the tax treatment of carried interest. Any hopes on the part of PE professionals that this would be left untouched must surely be dashed now that Sir Ronald Cohen has argued the case reform. Cohen is the (politically) acceptable face of the industry, and a friend of the Government. If he is talking this language the writing is surely on the wall. See the FT report.