LBO France expands into Public Equity
LBO France is expanding beyond its existing private equity business with the launch of a new listed investments business via France Développement.
This initial fund has been granted the “France Relance” Label, a French government stimulus program, and will take minority stakes in a limited number of listed French small and mid caps with market caps between EUR100 million and EUR3 billion.
Initiated by a recognised equity manager, Pierre Nebout, backed by Stéphane Sumar, France Développement benefits from LBO France’s know-how as a major private equity player specialising in French small and mid caps. The fund will be managed with all the thoroughness of private equity, with the resources to play its investor role in full as an active, constructive and long-term shareholder.
Listed and non-listed market strategies are synthesised by private-equity experts and the fund manager on the Investment Committee. The Committee ensures a conviction-based management style while supervising risk-taking, which is a trademark of private equity.
Investment holdings will be monitored with a focus on value creation. With the backing of the LBO France Operating Performance team, France Développement aims to make invested companies: easier to understand and more visible by assisting them in their financial and extra-financial communication; better performing with its value proposition in operating strategy and financial management; and more attractive by promoting a constructive dialogue with managers and supervisory bodies, particularly on ESG issues that are essential to economic sustainability.
France Développement has undertaken the process of SRI certification, driven by its conviction that a company must meet the expectations of all stakeholders for its development model to be sustainable in the long term.
ierre Nebout, Head of Public Equity at LBO France, says: “I am especially excited at the idea of restoring meaning to the profession of investor through contacts with entrepreneurs at a time when listed small and mid caps are under-researched while still attracting much attention, as seen in the many IPOs, market fundraising, and delistings. The current context is particularly favourable to launch France Développement. The exit of the covid crisis sees important inflows in Small and Mid caps, which some of them may seek to raise equity capital to accelerate their growth. The increase in the number of market operations testifies the vitality of this market. Our discipline in the field of fundamental analysis is an asset in identifying good business models and assessing risks, a need reinforced by the weakening of market research. Finally, the valuation gaps have rarely been so marked in favor of listed mid-size companies.”
Stéphane Sumar, Investment Director Public Equity, says: "Joining LBO France just as the France Développement fund is being launched is the logical conclusion of my 20-plus-year career devoted to the financial research on listed small and mid caps.”
Robert Daussun, CEO at LBO France, says: "France Développement stands astride the worlds of private and public equity. It adds a natural strategy to the LBO France platform by providing small and mid caps with patient, committed and long-term capital for their development projects and their financial and extra-financial valuation objectives."