Private Equity Exits: A Practical Analysis, Third Edition

Exits are the lifeblood of private equity: for private equity investors, at the top of their list of priorities when making an investment is an understanding of when and how they will realise it in due course. The methods of exiting private equity investments have developed over the years, and particularly as a result of the hyper-competitive market for quality assets and disruption caused by global macro-economic events such as the novel coronavirus pandemic. To the usual trade sales and initial public offerings (IPOs) have been added secondary, tertiary (and more) buy-outs, refinancings, partial sales, private equity house spin-outs, liquidations and an increasing number of “fund-to-fund” transfers. In these uncertain times, private equity houses will continue to put a significant focus on what options might be available to them to realise their portfolio investments, being mindful of not just the economic risks, but also the legal, tax, regulatory and reputational issues at stake. Management teams are key to this process and their economic, commercial and personal priorities cannot be underestimated in what is a very complex environment of often conflicting aspirations. This practical guide features contributions by leading specialists (including from Latham & Watkins, Linklaters, Macfarlanes and Ropes & Gray) on a range of topics linked to the exit of private equity investments. Topics featured include preparing for exits, vendor diligence, management issues, auction sales, partial exits, private equity house spin-outs, IPOs, refinancing, winding-up, tax and perspectives from Luxembourg, the US and views on the emerging markets. The third edition also includes analysis on emerging and established trends impacting exit terms, including early management liquidity, the prevalence of insurance solutions and related party or fund-to-fund exits. Together, the contributors provide an invaluable guide to the legal, regulatory, tax and practical elements in play. Whether you are a lawyer in practice or in-house, this commercially focused title will provide you with an invaluable all-round overview of private equity exits.

Table of Contents:
Introduction 5 Tom D Evans Latham & Watkins Auction sales 7 Tim Wright DLA Piper UK LLP Vendor diligence 21 Stephen Drewitt Macfarlanes LLP Partial exits 31 Neil Campbell Maarten Overmars Latham & Watkins Private equity house spin-outs 51 Lucy Gillett Amy Mahon Simpson Thacher & Bartlett LLP GP-led fund restructuring as a portfolio exit mechanism 69 Tom Alabaster Lavanya Raghavan Ropes & Gray Warranty and indemnity insurance 77 Sachin Kucheria Caroline Rowlands Howden M&A Private equity sponsored IPOs 91 Chris Boycott Tom Thorne Linklaters Winding-up 113 Philip Hertz John MacLennan Gabrielle Ruiz Clifford Chance LLP Management issues 139 Emma Danks Taylor Wessing LLP Private equity exits: financing perspective 151 John Dawson Patrick Donegan CMS Cameron McKenna Nabarro Olswang LLP Tax issues 163 Sean Finn Latham & Watkins Private equity exits: a Luxembourg perspective 179 Pierre Beissel Claire Guilbert Arendt & Medernach US private equity exits: key differences from UK practice 207 Howard Sobel Vi Thai Tran Latham & Watkins Emerging markets exits221 Kem Ihenacho Linzi Thomas Latham & Watkins About the authors 229 Index 237 About Globe Law and Business 248