Private Equity heads fend off critics

The leaders of four of the UK’s most powerful private equity groups gave a
good performance before the Treasury select committee yesterday, as they argued
that the industry was a force for good and played by the same rules as any other

Damon Buffini from Permira, Philip Yea from 3i, Robert Easton from Carlyle
and Dominic Murphy from KKR were summoned by the Treasury select committee to
answer criticisms from unions and politicians that the industry lacked
transparency, enjoyed unfair tax advantages and stripped companies of their

‘We do a good job for our investors and customers and we have excellent
relations with our employees and unions,’ Easton said.

Murphy said: ‘We are a force for good. Private equity has created more jobs
at a faster rate than institutional investors.’

Yea defended the industry against accusations that its executives made too
much money from carried interest payments, which attracted low tax, without
taking the enough risk.

‘Private equity is not a one-way bet,’ said Yea. ‘There are an awful number
of private groups out there that have not survived their first fund. Carried
interest focuses people. It is not some kind of golden shower at the end. If you
make a bad investment choice it costs you personally.’

Further reading:

Private equity bosses ‘will bow to tax rises’

Private equity crash could hit shares

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