Private equity slowdown means recruiters can afford to be picky

Private equity hasn't exactly enjoyed a stellar year in the Middle East this year, with the number of deals slumping in comparison to 2007. However, recruitment continues at a steady pace, even if employers are becoming increasingly stringent in their hiring practices.

There's been a dearth of billion-dollar deals in GCC countries this year, and only 12 investments were made across MENA in the first half of 2008, compared to 33 last year, according to research by the Gulf Venture Capital Association.

This isn't too surprising, when you consider that mega-deals across the globe have become a rarity this year. But the GCC is better positioned than most regions to bounce back, according to industry experts.

Rami Bazzi, principal, private equity at Injazat Capital, says: "While the GCC banking sector landscape is still looking resilient, the impact from the global financial sector turmoil will definitely be felt in the local market sectors, PE included. We expect mega-deals to be affected the most, while small to mid-size transactions in the GCC will sustain their activity."

So how has this slowdown affected recruitment, bearing in mind that a study by Deloitte earlier this year suggested a lack of talent threatened to stifle this rapidly growing sector?

Tasawah Ulhaq, director of Carrington Fox's Middle East office, tells us: "It was very busy earlier this year, but has slowed slightly recently. There are still many firms looking to take on the right people, and a good mixture of contacts and local experience is highly valued."

A study by consultancy McKinsey has tipped private equity activity in the GCC to grow in the years ahead, and expects the financial crisis to have a limited impact on private equity in the region.

Gary Long, president and chief operating officer of Bahrain-based Investcorp, believes private equity in the GCC is entering a "golden age". Speaking at the Super Return Middle East conference, he said: "It's big and will become bigger. It will also play an important part in developing local economies in the region."

Ulhaq says he expects recruitment in this space to pick up: "From speaking to clients, I would say the next two or three months will be much busier."

Managing director roles in private equity can pay $200k-$500k, with up to 200% bonus, as well as carried interest, according to figures from EM Services. The humble analyst only gets $40k-$100k, with a 30-80% bonus potential.