Buyouts Review 2008

2008 has been a year of extraordinary change in our industry and the wider economy. The impact of bank failures and subsequent multi-billion euro government bail-outs on leverage, especially consumer credit facilities, has had an exceptionally swift impact in the real economy. This sharp economic slowdown coupled with the scarcity of debt and uncertainty around pricing has created a difficult but exciting environment for private equity.

We continue to work very closely with our portfolio companies, many of whom are facing increasingly challenging trading conditions. At 3i we have always worked actively with the boards of our investee companies to help them meet their objectives, but now with our more systematic approach to supporting and challenging them across a range of operational, commercial and strategic areas, we aim to drive significant performance improvement to help them create robust and sustainable businesses for the year ahead.

There is no doubt 2009 will bring with it more challenges both for the portfolio and deal flow. The experience in the team, our deep local relationships and international connections, combined with strong sector and operational expertise, will help us access potential opportunities and support our portfolio through what will be a
testing year.