Private equity opportunities coming soon

Mid-market private equity deals in Scotland outstripped most other areas of the UK last year, but sadly this doesn't seem to have created a raft of job opportunities. However, there are signs that the small deal market could prove the place to be in 2009.

A report by LDC, the private equity arm of Lloyds Banking Group, shows that mid-market deals (50m-150m) in Scotland were almost treble 2007 levels last year, while the number of completed deals in the 5m-50m range shrank.

Still, there things are now beginning to look up at smaller end of the market, reckons Paul Munn, co-founder and managing director of Edinburgh-based private equity firm, Par Equity.

"The current conditions have been something of a fillip for the start-up area. In times like these a lot of people in previously secure jobs are suddenly finding themselves out of work. This may spur them to take something that was a pet project on to the next stage of innovation. There's a good network of angels and VCs north of the border to support that."

Gail McManus, director of Private Equity Recruitment, says she's yet to witness a great deal of recruitment this year: "In the summer of last year, there was a rush of recruitment around the energy space in Scotland, but I'm not seeing a lot of activity so far in 2009."

This could change going forward, as smaller private equity firms - such as Nevis Capital, push to take advantage of lower markets, says Graeme Cassells, corporate finance partner at PKF in Scotland.

"Private equity investors have cash to deploy, as do several of Scotland's family-owned investment companies and cash-rich individuals, and they are likely to broker acquisitions in the coming months," he says.

"The first few months of 2009 have been slow, but opportunities are arising as a result of the current environment."