A few days ago, my bank presented me what they described a "potential great investment" which was the new LBO fund raised by PAI, one of the leading private equity firm in Europe (United Biscuits, Kaufman & Broad, Lafarge Roofing to name a few recent large transactions). The track record of the team is definetly awe-inspiring with IRR around 30%+ gross.
My money had to be invested for 10 years, but that was no issue : taking a long term view is simply in my DNA !
But I declined the offer. Indeed, given the "carried interest" taken by PAI investment team (share of investment gains) and the healthy management fees (usually 2% of managed funds), the net return for investors is far below the 35% mark : indeed, it's just over 20%. My money could grow 3 to 5-fold over this 10 year time frame.
This is still very decent, but it is nonetheless far away from I want to achieve : here's the pattern :
Watch out, this is no internet or technology company : it is a solid brick&mortar/old economy company, the very type of company any LBO house would love to acquire.
No burst in 2000, a solid continuous ramp up overtime.
Little wonder though, strong competitive advantage, growing market (by old economy standards, ie a few % per annum). A company one could anticipate growing cash flows for the coming decades...
The company is listed on the Nasdaq and stock price grew up 30 times over the last 10 years.
This is what I'd like to achieve !
donne plus d'indices, c'est dur a trouver ;)
Posted by: sebastien (ny) | October 05, 2007 at 01:19 PM
come on Seb, you can do it !
Posted by: Michel de Guilhermier | October 05, 2007 at 03:12 PM
Just a few clues :
- Kentucky based
- Around 6000 employees
- $2bn market cap roughly
Posted by: Michel de Guilhermier | October 05, 2007 at 03:24 PM
Genlyte Group Inc.
Posted by: Julien | October 05, 2007 at 07:27 PM
Ce n'était pas vraiment un quizz, mais oui, c'est bien ça ! Bravo Pascal, Sébastien et Julien (dans l'ordre où j'ai reçu les réponses)
Posted by: Michel de Guilhermier | October 05, 2007 at 07:45 PM
Indian stock market
Hi Everyone.
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We all know that Indian stock market has become volatile now a days. One day its going up and another day its coming down. So we all should like to know
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Posted by: sharetipsinfo | December 20, 2007 at 07:15 AM