201. Why you can sleep more easily with private equity investments

Schroders investment directors Paul Lamacraft and Pav Sriharan talk us through the benefits of private equity investing and why the asset class is a great fit for an investment trust vehicle. The pair also talk about the types of companies they target for the British Opportunities Trust, discuss the importance of funding UK growth and buyout companies in what is an uncertain time for the UK economy, and reveal why they are excited about the prospects for their investment in Mintec.
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One of the few products to be launched in response to the Covid-19 pandemic, the Schroder British Opportunities Trust seeks to tap into the unloved status of UK equities by targeting companies which have been in the eye of the storm. The portfolio consists of 30-50 small and medium-sized public and private businesses requiring fresh injections of equity, with the trust aiming to provide a net asset value total return of 10% per annum.

What’s covered in this episode:

  • What are the benefits of private equity investing and why the team focus on growth and buyout businesses
  • Why investment trusts are a great fit for investors looking to access private equity companies
  • The importance of understanding the exit options for a company at an early stage and the need to have as many options available as possible
  • How the team go about transforming a new acquisition to improve both its scale and value
  • Why there is an ongoing need to fund and support UK growth and buyout companies
  • The importance of ESG and why the management team are happy to invest in companies that need help to develop and deliver the right ESG framework
  • Why they are so bullish on their holding in a reporting agency for non-exchange traded food commodities
  • Why investors should be looking more closely at private equity as a long-term holding
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