Dutch lawmakers admitted that private equity plays an important role in the country’s economy but still expressed concerns about the poor performance of some portfolio companies during an industry fact-finding mission last week, said Tjarda Molenaar, managing director at Dutch private equity and venture capital association NVP, in an exchange with pfm.
The atmosphere at the event was “balanced,” noted Molenaar, and the attending GPs provided some unknown facts about the investments in question in order to clear up some of the misconceptions that Parliament had about the industry.
In attendance on behalf of the private equity sector were NVP President Philip Houben, Ludo Bammens
of KKR, Pieter de Jong of 3i and Gert-Jan Huisman of Anders Invest. Pension fund PGGM, the Confederation of Netherlands Industry and Employers and Dutch trade union association FNV also attended, as well as economists and tax advisers.
Lawmakers did not mention any possible impending regulation during the meeting, but suggestions were made by some of the invitees, such as “further rules on deductibility of interest and a stronger position of works councils in decisions about dividend payments,” Molenaar noted.
Invitees “repeatedly” mentioned that Parliament should first wait and see the effects of recent regulations around use of leverage, risk management, asset stripping and transparency before introducing any new rules.
The Labor Party led the initiative, concerned about the poor performance and bankruptcy at a handful of Dutch portfolio companies, including department store Vroom & Dreesman (owned by Sun European Partners), childcare group Estro (owned by HIG Capital) and waste processor Van Gansewinkel (owned by KKR).
Dutch firm Egeria turned down its invitation to the discussion, saying the three-hour meeting would be “insufficient to give a good insight into private equity and into our firm in particular.” The firm invited Dutch MPs to come to its office for a private meeting instead.