Private Equity Fund Formation 2009 ‘At Market’ Deal Terms

In the current economic environment the business issues which arise in the course of negotiating the documentation governing new Funds, as well amending existing Fund terms, will be different than in the era of easy and cheap credit which fueled the leveraged buyout boom of 2002-2007.

There are currently 1600 private equity Funds in the market looking for $900 billion of new funding (Preqin statistics). At the same time, successful fundraising is down dramatically, falling over 75% in the last quarter of 2008 relative to the same period in 2007. In 2009 expect tough bargaining between sponsors and investors over the terms of new investments and