VIEWS OF GERMANY

“The pipeline for deals is good all over Europe, but especially also in German-speaking countries. We're busy talking to business owners with ambitions to grow, succession issues and pre-IPO plans. The pace of deal making isn't fast, because price expectations vary and noone has a clear view on the economy. But we are having very interesting conversations.”

Michael Hehn, managing director, Morgan Stanley Private Equity, London

“Twelve to 18 months ago there was no maximum underwriting limit, and a constant trend towards more aggressive structures. Now, there is a lot more volatility and every deal is treated differently. Views are being taken of particular sectors, where during the peak there were very few no-go areas. Now there is a lot of caution about retail, for example. People are also now worried about the prospect of a downturn and, if there is one, whether it will be v-shaped or u-shaped.”

Stuart Hewer, head of leveraged finance Germany, RBS, Frankfurt

“Germany has a strong entrepreneurial tradition, a highly educated population, and tremendous strength across many industries, including healthcare, technology and financial services. The biggest opportunity there, as always, is to partner with seasoned managers of growth businesses in an exceptionally receptive environment.

Still, there are reasons for caution. Although the German economy performed well early in 2008, momentum seems to be slowing. Any further weakening may cause difficulties across sectors and industries. Moreover, there may be further fallout from the credit crunch in Germany, where banks have been slower to write off assets and raise capital than in other economies.” Scott Collins, managing director, Summit Partners, London