Welcome to the May 2010 edition of Pilot’s Log

My father used to tell me that time accelerates as one ages. When one is 18 and heading off to college, it’s hard to believe something like that.

Well, as I continue to turn into my father, time indeed does continue to accelerate. But oddly, not across the board. When it comes to witnessing my children spring up around me, the changing of the seasons, the direct debit of my mortgage bill, then yes, time is speeding up.

However, for some things, time seems to be forever slow. Waiting for my next vacation, hoping my wife just once tells me that I’m right about something, and watching the slow recovery of our common marketplace.

To be fair, private equity has seen an increase in activity, though not across all deal sizes. All signs point to deals getting down, even without the banks re-opening their wallets.

In this issue of PILOT’s Log, we are focusing on stressed deals and stressed deal flow. This is one part of the market that is becoming more vibrant, with both traditional stressed investors and even classic mid-market firms now looking at finding ‘value’ through operational improvement instead of leverage.

Pieter Kraan, our esteemed colleague in Germany, shows us that even while traditional deals became rare last year, distressed investing remained very healthy.

Aidan Condie, a very skilled turnaround CFO/CRO well trusted by the banks, explains the vital link between new capital / liquidity and new management, and how the predicament that banks find themselves in (carefully chosen words I know) has delayed or halted the infusion of necessary management skills into deteriorating situations.

The major piece in this issue is Alan Thomas discussing the official launch of theXtraMarket (“XM”), his new marketplace which he touched on in the last issue of PILOT’s Log. Alan, who has enviable credentials (and an enviable Rolodex), explains the void and subsequent need for alternative sources of investment capital, and how XM is designed to be a rapid and high quality mechanism to that end.

It should come as no surprise that PILOTpartners is a big fan of XM, if for no other reason than the clear link between increased deal flow equaling the increased need for high quality and high impact board level executives (like Aidan) that we spend all of our time sourcing and showcasing.

Michael Gebauer
Partner – private equity practice

E: m.gebauer@pilotpartners.eu

T: 0783 423 5458