Click here for printer friendly page

Management team crucial to MBO success, says SJ Berwin

The importance of a quality management team to the success of MBOs has been confirmed by the publication of a survey of senior European venture and buy-out investors.

Commissioned by European law firm SJ Berwin, the survey has found that 69 per cent of investors across Europe agreed that the key factor in the failure of MBO deals was the failure of the management team to deliver.

Jonathan Blake, head of private equity at SJ Berwin, said: ‘The term “management” will once again be inextricably linked with the buy-out transaction, after years with the term “MBO” seemed to have been replaced by “LBO”'.

Further findings of the survey were that a board seat or an active monitoring role was considered crucial for investors and that the UK had the best and most numerous management teams.

With the emphasis more than ever on the buy-out as the most attractive private equity sector for investors, management teams with hands-on operational experience and a willingness to innovate are likely to remain an important priority for European investors.

Copyright © 2003 AltAssets