Adveq: European integration to change PE market

As Europe becomes ‘more homogenous and more integrated’, deal opportunities will shift, according Bruno Raschle, CEO of the Swiss fund of funds manager.

The current structure of Europe offers a number of private equity options resulting from cross-border investing opportunities as the continent is not yet fully integrated, Bruno Raschle, chairman and CEO of Swiss fund of funds manager Adveq, said in an interview.

“As it becomes more homogenous and more integrated, investment opportunities will be different” from what they are now, he said.

While he didn't spell out precisely what the opportunities will change from or to, he said Europe's economy may become “much more decoupled” from that of the US, making asset managers increasingly view the two markets, in terms of risk adjusted returns, as separate.

The rationale for investment in the three major private equity regions differs more greatly than ever before, Adveq had said at its annual press conference in Frankfurt last week.

Bruno Raschle

In the US, the firm said, bankruptcies and defaults are presenting distressed and turnaround managers with promising opportunities, while in the technology sector, only high-quality innovations are being funded due to a low inflow of venture capital investments.

In Asia, Adveq sees more than 1000 managers across the region, of which about 100 have the same quality as the best in the Western world and these managers are in China, Japan India and Southeast Asia. Their investment theses are dictated by growth.

“For the first time, an asset manager deliberately has to make a choice and this is in the context of his overall risk management and financial modeling of the total asset base,” Raschle added.

Founded in 1997, Adveq has $4 billion of assets under management. It has offices in Zurich, Frankfurt, New York, Beijing and a representative office in Sydney.