Buzz Archive:
From Private To Public: The Evolution of an Asset Class

by SJ Berwin, 11/7/2007

Earlier this year, the British Private Equity and Venture Capital Association (BVCA), commissioned an independent review of reporting and transparency in the private equity industry. The report's primary author, Sir David Walker, published preliminary proposals for consultation in July, suggesting greater disclosure requirements for "large" portfolio companies and buyout houses targeting bigger deals.

However, there are legitimate concerns here. One is that some of the proposed disclosure obligations could require private equity backed companies to reveal commercially sensitive information to their competitors. Another issue is that some companies acquired by a buyout fund will need time to put systems in place to enable them to comply. The proposal now is that there would be a body (perhaps akin to the Takeover Panel) which will monitor compliance as necessary. What can the U.S. and other countries take from this? Perhaps that well intentioned regulation can quite often take on a life of its own and hinder the very goals of the regulation. Read more from Simon Whitney, Partner at SJ Berwin LLP.