The best days of private equity are over, says Egyptian billionaire Nassef Sawiris

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According to the Egyptian industrial and billionaire investor Nassef Sawiris, the private -equity industry, which has the highlight of the private equity industry in top value, is contrasted with the sale of assets in billion dollars.

Sawiris, who has invested parts of his assets in money in several Buyout companies, said he and others who reset private -equity funds have been frustrated in recent years. The companies have trouble ending investments, while dealmaking and the first public offers slow down postpandemically.

“Private equity saw its best days … they cannot leave. The exits are so hard,” said Sawiris the Financial Times.

“(Investors) are so frustrated. They tell them (Buyout companies):” I have not seen any returns, they have not returned money to me in the past five or six years. “

Sawiris particularly aimed at the use of “continuation fund” for recycling capital – a tactic in which Private equity Groups postpone the asset instead of selling or publicly listing an asset to another owner, into a new fund in which they still keep control.

“Continuation of the fund is the biggest fraud of all time because they say:” I can’t sell the business, I will be lever again, “said Sawiris.

The continuation of vehicles has become increasingly popular in recent years and, according to a report by Investment Bank Houlihan Lokey, rose by about 50 percent last year and reached a record of $ 76 billion last year.

The comments come when Sawiris monitored the separation of his Dutch chemicals and the fertilizer empire OCI.

The group in September made his fourth great disposalto bring the gross proceeds from sales with assets to $ 11.6 billion, all of which were beaten by commercial buyers rather than buyout stores. It has now sold most of its assets, including the global methanol business, the fertilizers and an ammonia project in Texas with low-carbon.

OCI used these sales to return cash to shareholders. Including a payment that is to be made later this week, it has distributed $ 6.4 billion in the past four years, with a further payment of up to 1 billion USD expected after the sale of its methanol business has been closed.

Sawwiris said that the company “very happy with the time of the departures” in view of the turmoil, which disturbed the handling of dealing with dealing with the turn against investments in more sustainable assets and a decline in gas prices.

Sawwiris told the FT In an interview Last year, OCI could go to a cash shell company that pursues acquisitions in various industries.

He said he had been asked to buy dozens of companies with the proceeds from his wealth sales.

Many of them belonged to private equity groups who hoped for an exit, said Sawiris and added that he found not a single of them as an attractive goal for a deal.

“A year ago we looked at 70 different companies that wanted to be brought together with OCI because they were raised, and a list and all of this … all private equity that cannot get out,” he said. “We said” how, why are we there to solve someone else’s problem? “

He also criticized the priorities of private equity managers and said that they were far more to increase capital for their investment vehicles than the operational performance of their portfolio companies.

“They spend 90 percent of their time with donations and 10 percent of the management,” he said. “They take part in board meetings, have a board dinner and there is a reason why they did not carry out the plan.”

After decades of expansion management of the private -equity industry, the assets of the private -equity industry manage shrunk last year For the first time since the consultation, Bain & Co started persecution of the industrial assets in 2005.

In June 2024, the assets of the industry only went 2 percent to 4.7 m in the previous year. Slowly dealmaking.

In the past few years, investment groups have been in difficulties with the sale of assets at high ratings and made their fundraisers difficult.

In the middle of the more comprehensive challenges that the private equity industry faces, Sawiris said that the groups who were best successful Blackstone to challenge the most important credit banks.

“The only people who have a future are the boys who found a niche as a competitor of JPMorgan and Bank of America.”