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Questions and Answers
What does Private Equity involve?
Investment managers employing investors' capital to invest in non-listed companies.
Which of the following are managed products in Private Equity? (Select all that apply)
Expansion capital involves a change of control of the business.
False
What is one advantage of private equity investment for target companies?
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Expansion capital is a type of private equity investment that focuses on relatively ______ companies.
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What is a key step in the Private Equity process?
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Study Notes
HAT SGR Investment Strategy
- HAT SGR is an asset management company with €320 million in assets under management.
- Focuses on innovation, technology, and infrastructure investments.
- Manages four alternative investment funds, including private equity, venture capital, and infrastructure funds.
Private Equity
- General Partners (GPs) use Limited Partners (LPs) capital to invest in non-listed companies.
- Aim is to increase company value, generate returns for LPs, and potentially for GPs if they overperform.
Private Equity Process
- Starts with meeting an entrepreneur and evaluating their business.
- Involves due diligence, deal structuring, and valuation.
- Focuses on creating value through organic and external growth strategies.
- Includes competitive bidding, private transactions, and financing.
Expansion Capital
- A type of private equity investment for mature companies seeking funds for expansion, restructuring, market entry, or acquisitions without changing control.
- Targets companies with a clear business plan for growth.
- Investment horizon ranges from medium to long term.
Features of Expansion Capital
- Offers capital increase for growing companies.
- Provides financial and managerial support with a clear business plan.
- Offers a medium to long-term investment horizon.
Advantages of Expansion Capital for Target Companies:
- Provides financial resources for implementing business plans and growth strategies.
- Offers access to a network of financial contacts.
- Provides managerial expertise and guidance.
- Provides access to capital markets for future financing.
- Offers potential exit opportunities through IPO or sale to another company.
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Description
Explore the fundamentals of private equity and the processes involved in evaluating and investing in non-listed companies. This quiz covers the roles of General and Limited Partners, due diligence, and strategies for creating value in mature companies seeking expansion capital. Test your knowledge on investment management and private equity processes.
