Realise The Power of Private Equity and Alternative Investment

LONGER-TERM AND STRATEGIC INVESTMENT FUNDS

AN ALTERNATIVE TO TRADITIONAL PRIVATE EQUITY

In recent years, there has been a steady increase in the number of long-term investors active in the market, offering a credible alternative to business owners looking to exit their company. These investors acquire companies and hold them indefinitely. They become self-sufficient in that all cash generated from their business operations is re-invested into future acquisitions, which in turn increases the fund’s value over time. The longer-term vision of these investors can create a less pressured environment than private equity as there is no fixed timescale for the investor to make a return on their investment. Hence this investor type can suit more cyclical companies and sectors.

It is common for a portion of the exiting shareholders’ equity to be retained or rolled into a shareholding of the acquiring fund, which over time could increase

in value. Commonly, the aim of these groups is to ultimately go public on a stock exchange, to capitalise on the fund’s accumulated value following a period of acquisitions and business growth.

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