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Asian Private Equity: Creating Value in Portfolio Businesses

Alvarez & Marsal (A&M) set out to better understand how private equity firms in Asia work with their portfolio companies to improve performance by polling senior executives of 30 private equity firms in the region with combined assets under management of more than US$165 billion.

Our report, Asian Private Equity: Creating Value in Portfolio Businesses, reveals that having the right management capabilities within portfolio companies is considered the biggest hurdle in trying to improve performance in portfolios. The vast majority of respondents (97 percent of private equity firms) are challenged by management capabilities at portfolio companies.

Despite the varying and often changing regulatory environments found across the region, our research shows that private equity firms are less concerned with regulation than any other factor, with 57 percent of respondents indicating that they rarely or never find it to be a challenge.

The A&M survey also found that the two most common ways of dealing with performance issues in portfolio companies are for the business to be refocused or for management to be replaced, with 90 percent and 70 percent of firms, respectively, claiming that they had taken these intervention measures over the last three years, and Chinese firms being less likely to replace management than regional or global firms.

To receive a copy of the complete report, contact us at AsiaPE@alvarezandmarsal.com.

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Oliver Stratton
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