23 firms sign up to Walker, BVCA monitoring group appointed

Compliance with the Walker report has pushed some publicity-shy buyout firms into the spotlight.

The British Private Equity and Venture Capital Association has appointed the monitoring group to oversee compliance with the Walker guidelines.

David Walker:

Alan Thomson, former group finance director of industrial company Smiths Group and Jeannie Drake, director general of the Communication Workers Union, have joined the committee chaired by Sir Mike Rake, the chairman of UK telecoms group BT.

The three independents will be joined by industry representatives The Carlyle Group’s Robert Easton and The Blackstone Group’s David Blitzer, in a structure explicitly designed by the committee’s architect Sir David Walker to have a majority of independents.

The BVCA has also persuaded 23 firms to sign up the guidelines including vocal advocates of transparency such as European buyout firms Bridgepoint and Permira, as well as firms which have in the past chosen to be more private such as CVC Capital Partners, Charterhouse Capital Partners and Bain Capital.

Absent from the list were firms such as European buyout firm BC Partners, which bought UK estate agent Foxtons for £400 million ($785 million; €538.5 million) last year, and European mid-market buyout firm PPM Capital, whose managing director Neil Macdougall broke ranks to speak out against the reforms when his firm span out of financial services company Prudential last year.

The Foxtons transaction does not fall within the Walker guidelines. Qualifying companies bought in non-public to private bids have to have an enterprise value greater than £500 million, with 50 percent of their revenues inside the UK and with more than 1000 full-time UK workers. Public to private targets have to have a market capitalisation of more than £300 million to be covered by the guidelines.

A source close to BC Partners said the firm will comply with the guidelines once it has a company that falls under the criteria. 

Mid-market firms like PPM Capital have generally eschewed the reforms if none of their companies fall under the criteria, but some firms in the mid-market have openly embraced the reforms despite the opt-out clause. Duke Street Capital has said it is willing to introduce the guidelines across the majority of its portfolio, while having few companies which will fall under the criteria.