The world’s focus on dealing with the pandemic
will continue to disrupt M&A activity in the short to medium
term. Financial sponsors and the direct investing platforms of
pension funds will grapple with many of the same issues as
strategic players (and their boards) in the coming
months.
While it is early days, there are certain challenges (and
opportunities) on which sponsors in particular have been and will
continue to be focused.
Protect Existing Assets
Sponsors are focused on their existing portfolio companies first
and foremost. Meeting payroll, continuity of supply chains, meeting
debt covenants and keeping management engaged in a difficult
circumstance are front and centre and have in the near term
superseded new deal flow as a priority. No asset is more important
to sponsors than their people.
