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2009 Carried Interest and Compensation Survey

By John P. McNulty
June 2009

ShareThe Private Equity Professional Digest 2009 Carried Interest and Compensation Survey was conducted from March through April 2009 and gathered data from 140 private equity funds. Approximately 70% of the funds in the survey are presently investing a fund that is less than $500 million in capital with the balance of the funds evenly split between $500 to $1 billion and greater than $1 billion.

The survey results speak for themselves but one clear trend has emerged.

Read more.  (This article is premium content and is available to registered members only).


Non Partners Increase Share of Carried Interest

By Danielle Fugazy
June 2009

ShareEvery incoming class of private equity professionals want to know what their carry is going to be. Doling out carried interest stakes to new employees is commonplace now and it has been for quite some time. According to the most recent carried interest survey conducted by Private Equity Professional Digest, carry has become so widespread that most private equity firms give entry-level professionals a small percentage of carried interest and some even allow administrative staff to participate in the carry.

“If you go back ten years ago, only partners received carried interest. But when the market started taking off in 2000 there was tremendous pressure to hire the best people and all of a sudden carried interest was being given to people below the partner level. It soon became the competitive norm,” says Michael Holt, managing director of Holt Private Equity Consultants. “Now all the principals, vice presidents and senior associates are given carry. So many private equity firms gave it, now it is an obligation.”

Read more. (Registration as a visitor to the website is required to read this article).

Other Stories

The Recessionary Fraud Double Whammy
The prospect of being on the wrong end of a fraud is an unnerving one for businesses at any time. In turbulent times like these though, the impact that a fraud may have can be far more marked than under happier economic conditions. Unfortunately, the probability of a new fraud being perpetrated — or of a longer running fraud finally coming to light — is far higher in a recessionary climate.  To make matters worse, the well-intentioned cost cutting programs which many corporates are putting into place might reduce the efficiency of anti-fraud measures — just when they’re needed the most. Read more.  (This article is premium content and is available to registered members only).

The Good the Bad and the Ugly: Options for Private Equity in the Current Business Downturn
Private Equity owned businesses are tripping loan covenants, being asked to inject fresh equity, and filing for bankruptcy protection in record numbers. The carnage is likely to increase as the steep falloff in business accelerates in 2009. Even now lenders are staffing up their workout groups to prepare for the onslaught, and being more aggressive with troubled businesses.  In today’s adverse business environment, is there anything that can be done to prevent getting to this stage? Despite not having a magic wand to fix the economy (growth makes up for a lot of evils) and get credit flowing again, there is something proactive private equity firms can do to improve the survival odds of their portfolio companies. Address the classic leadership dilemma in a new way.  Read more.  (This article is premium content and is available to registered members only).

Asset Disaggregation: A Strategy To Facilitate Acquisitions and Exits
Acquisitions, whether the target is a platform company or an add-on, almost always involve expendable assets regarded as surplus, duplicative, underperforming, or not synergistic with the strategic direction of the go-forward business.  Closing these transactions can challenge even the most astute negotiators.  Read more.  (This article is premium content and is available to registered members only).

Introduction to the 2008 Marketing Best Practices - Investment Banks Survey
Editors Note: At some point or another every private equity professional has said, “I wish I knew what the banker thinking?” Well, wish no further. Private Equity Professional Digest surveyed more than 400 investment bankers to find out what’s on their minds when it comes to private equity firms, deal making and best practices. Read more.  (This article is premium content and is available to registered members only)

Results of the 2008 Marketing Best Practices - Investment Banks Survey
Here are the  responses to all 42 questions that the survey asked.  Results are provided in a graphical format or in a PDF format as needed.  Read more.  (This article is premium content and is available to registered members only)

Two and Twenty: Taxing Partnership Profits in Private Equity Funds
According to private equity legend, this article by Victor Fleischer started the carried interest is ordinary income not capital gains debate that raged in Washington late last year and early this year and may again become an issue in 2009.   Read more.  (This article is premium content and is available to registered members only)

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Private Equity Professional Digest is published by and for private equity investors.  Our staff of experienced private equity investors  has many years of direct experience in private equity. 

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News to Know


Today's Deals

Black Canyon Capital Acquires JDC Healthcare
July 2, 2009 - Black Canyon Capital announced today that it has completed a recapitalization of JDC Healthcare in partnership with the company’s owner and founder, Dr. David Alameel, and management.  The investment in JDC was structured to replace the company’s existing lenders and to capitalize the business to capture future growth opportunities...Read more.
Sun Capital Partners Acquires Big 10 Tire Stores
July 2, 2009 - Big 10 Tire Stores today announced that it has completed the sale of its operations to New Big 10 Tire Stores, Inc. (“New Big 10”), an affiliate of Sun Capital Partners...Read more.

H.I.G. Acquires Nations Express
July 2, 2009 - Amerijet International, a portfolio company of H.I.G. Capital, today announced its acquisition of a majority interest in Nations Express...Read more.

For all deals from the past week
please visit our trailing
4-day Deal Trax  Archive

Go to the Deal Trax Archive 
Todays Headlines

KazManufacturer of Vicks Humidifiers and Honeywell Air Purifiers Up for Sale
July 2, 2009  - The New York Post reported yesterday that the Katzman Family which owns and operates Kaz Inc., a manufacturer of Vicks humidifiers and Honeywell air purifiers, has put the company up for sale.  It was reported that the firm could be valued for as much as $150 million...Read more.


Money TreeKayne Anderson Closes on $820 Million
July 2, 2009  - Kayne Anderson Capital Advisors announced yesterday the closing of its fifth energy private equity fund with total commitments of $820 million...Read more.
TeamElie Dekel Joins Saban Capital Group
July 2, 2009  - Saban Capital Group a private equity firm specializing in the media, entertainment and communications industries, today announced that Elie Dekel will join the firm as a Managing Director.  Mr. Dekel will focus on expanding the firm’s licensing, merchandising and intellectual property opportunities in the US and internationally. He will be based in the firms Los Angeles office...Read more.
IndustrialPortfolio Company Management Dominates Recent Private Equity Activity
July 1, 2009 - Faced with a difficult economy and a weak deal-making environment, private equity firms are aggressively managing their portfolio companies by reducing employee headcounts, strengthening working-capital management, freezing salaries, improving business processes and reducing capital spending according to a new survey by RSM McGladrey Capital Markets. A link to a free copy of the survey is available at the end of this article...Read more

For all articles from the past week
please visit our trailing
4-day News to Know Article Archive

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