Debevoise & Plimpton | Private Equity Report

The Art of Spinning Off

Spin-offs take various forms but share the goal of making the sum of a company’s parts worth more than the whole. They have surged recently but must be executed with care due to legal, tax and contractual considerations.

Guest Column: From the Desk of the EVCA Chairman

Optimistic about improved conditions for private equity fundraising and investment in Europe, guest columnist EVCA Chairman George Anson describes the EVCA’s focus on emerging regulations, engagement with new members the European Parliament and Commission, and continued outreach to policymakers, industry participants and observers.

SunGard 2.0

The emergence of cutting edge provisions in the financing arrangements of sponsor portfolio companies enables them to obtain SunGard-like conditionality in follow-on acquisitions, thereby mitigating potential competitive disadvantages in today’s seller-friendly M&A market.

Sponsor-Backed IPOs Keep Rolling

During 2013, the IPO market remained incredibly vibrant. Nearly half of the 200 IPOs completed during 2013 by gross proceeds involved private equity portfolio companies, and the trends that drove private equity-backed IPOs in 2013 show no signs of abating.

The King Can Do No Wrong: Sovereign Immunity and Its Exceptions

When state actors invest in private equity funds, they play by different rules. Under the doctrine of “sovereign immunity,” if the relationship sours, governmental investors may be protected from legal recourse in ways that other investors are not.

Everything Old Is New Again: PIK Notes

PIK Notes were a driver of M&A preceding the financial crisis and also a casualty of the crisis. 2013 witnessed a robust return of PIK Notes, with certain important structural differences but with many of their prior fundamentals unchanged.

Considering A Subscription Credit Facility? Here’s What You Need to Know

A primer on the increasingly popular use of Subscription Credit Facilities by private equity fund sponsors, including the benefits and potential burdens thereof, such as financial disclosure, restrictions on transfers of limited partnership interests, and waivers of defenses.

Options Under the Volcker Rule for Banks to Sponsor Private Equity and Hedge Funds

Along with the limitations it imposes on investments by banking entities in unaffiliated private funds, the Volcker Rule also places significant restrictions on the ability of U.S. banks, non-U.S. banks with a U.S. banking presence, and their affiliates to themselves sponsor private investment funds.

“Getting to an Answer in In re Answers”

Update on a 2012 Delaware court holding that a sponsor’s desire for immediate liquidity in a sale of a thinly traded public company could give rise to claims for breaches of loyalty against directors appointed by the sponsor.

What’s New: Leverage Lending Guidance

What is the Supervisory Interagency Guidance on Leverage Lending, why is it receiving so much main-stream press attention now and what could it portend for private equity transactions?

Recent Client Updates

Links to all Debevoise & Plimpton LLP client updates issued since our last issue that are most relevant to the private equity industry.

The Private Equity Report Editorial Board

This report is a
publication of
Debevoise & Plimpton LLP
www.debevoise.com

EDITORIAL BOARD

Paul S. Bird
Editor-in-Chief

Andrew M. Ahern
Jennifer L. Chu
Rafael Kariyev
Scott B. Selinger
Simon Witney

Alicia E. Lee
Associate Editor