This early mantra of the Brexiteers in government had been put to bed, we thought, as the negotiations about the negotiations began last week. But the leaked reports of a ‘fractious’ initial dinner between a ‘deluded’ May and President of the European Commission, Juncker, tell a different story.
Today, as always in the world of Private Equity, the no deal versus bad deal dilemma is alive and well.
Private Equity executives are on this planet to do deals. One quarter without a deal can be explained away. Two empty quarters and they start to question their raison d’être. Those management fees have to be justified, after all.
To date, 2017 has had little to offer Private Equity. Quality assets are in short supply and, as a result, processes are hyper-competitive and prices are sky high.
Most are holding their nerve. But as the year ticks by, and with record levels of dry powder burning a hole in their Saville Row suits, the pressure is building.
We are already seeing normally restrained Private Equity firms diverting from their tried and tested investment strategies, and chasing deals they would normally dismiss on a size, team, valuation or quality.
It is not that they have suddenly developed a blindness to these issues overnight. But they are forcing themselves to take on turnarounds, buy and build strategies or unproven growth stories.
Many will succeed in this.
But for some, entering the unknown may be a deal too far.
And 2017 may turn out to be more interesting than its early months have suggested.