On 24 November 2015, Invest Europe, previously EVCA, published a new version of its handbook relevant to the private equity industry.
Amendments to the version published in January 2014 include amendments to:
- Section 3.3 (investing), to emphasise the various factors the general partner ("GP") should consider with regards to responsible investing;
- Paragraph 3.3.7 (GP's consent to portfolio company actions and board appointments), suggesting that the GP obtain investor consent for various matters;
- Paragraph 3.4.10 (follow-on-investments), suggesting that follow-on investments in a portfolio company should be made by the fund that made the original investment;
- Paragraph 3.4.11 (underperforming investments), specifying that local legal advice must be sought when managing an underperforming investment, and the portfolio company must ensure to remain in compliance with all applicable legal and regulatory requirements;
- Paragraph 3.4.12 (factors particular to investing in distressed assets) has been inserted, which focuses on key considerations when dealing with distressed assets; and
- Paragraph 3.5.1 (implementation of divestment planning), which recommends that the GP should consider any relevant environmental, social and governance factors when preparing for a portfolio company exit.
The full text of the adopted amendments is available here:
http://www.investeurope.eu/media/431779/Invest-Europe-Professional-Standards-Handbook-2015.pdf
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
