Egeria snubs PE discussion in Dutch parliament

The firm’s attitude will only lead to heavier regulation for PE firms, one Dutch politician has warned

Netherlands-based Egeria has turned down an invitation to take part in a roundtable discussion about private equity that will take place in the Dutch parliament next week.

In a statement on its website the firm said it believes a roundtable discussion of 50 minutes will be “insufficient to give a good insight into private equity and into our firm in particular.”

Instead of attending the three-hour public hearing, Egeria has invited Dutch MPs to come to its office for a private meeting. Egeria declined to comment beyond the statement.

“In a democracy, it’s a common tradition that you accept a request from Parliament to talk about serious problems in a [particular] sector,” Henk Nijboer, a member of Labour Party, one of the governing parties in Holland, told PEI in an emailed statement. The firm’s decision not to participate “will only lead to an increase in support for further regulation on private equity,” he added.

Nijboer called for the roundtable earlier this year in a bid to give parliament a better understanding of the private equity sector. The initiative for the public meeting came after Dutch department store Vroom & Dreesman, which is owned by Sun European Partners, got into difficulties earlier this year.

“Private equity is useful when it is focused on long term growth. Start-ups are often dependent on private equity to build up their business. Private equity can also be a solution for mid-sized companies as well as family businesses that don’t have a succession [plan],” Nijboer said at the time, adding that private equity can often offer solutions that banks are unable to provide.

But he also warned about ‘excesses’ in private equity which he said “typically occur in businesses that have a lot of equity but that are still cheap because their revenues are under pressure. Anglo-Saxon private equity firms are particularly equipped to strip these companies using ingenious legal and fiscal constructions,” he said, naming NRC Media, Estro, Hema and Van Gansewinkel as examples of that. He called for ‘roofkapitalisme’ (robbery capitalism) to be banned.

Egeria has been under fire in The Netherlands for its investment in NRC Media because the firm took out a dividend of €12.5 million when 30 people were made redundant at the high profile national newspaper back in 2013.

While Egeria has snubbed the meeting, other firms will be attending. Among the participants will be KKR, Anders Invest and 3i Group, as well as a number of Dutch unions and university lecturers. 

“Over the last decades, as private equity has grown into an important investor in the Dutch economy, it is important to have a dialogue with important stakeholders and to contribute to this dialogue,” a spokesperson for KKR told PEI. 

The roundtable discussion will take place on 29 April between 2pm and 5pm in the Dutch parliament in The Hague.