Merchant banking: not just advice, but capital as well
People often ask, "what is Merchant Banking?" It is an old financial term, descriptive of the original practitioners of financial services. Today, it has come to mean something of a combination of the advisory services of an investment bank and the principal investment activities of a private equity firm. Mostly, it is about investing on the basis of your own advice to clients, or simply put, having "skin in the game."
At P|MB we seek to partner with talented existing or de noveau management teams who feel as we do:
- to acquire or invest in assets and companies within our sector focus groups at sustainable valuations, and
- as a result of P|MB involvement, have them emerge with stronger capital structures, better business focus, and enhanced growth possibilities.
Together with these management teams and our investment partners, we seek to create exceptional value over the next several years. We exercise structural flexibility with regard to how we invest. While we aim to be up in the capital structure, we recognize the need for alignment of interest among stakeholders.
Our investment parameters are driven more by what we perceive as the value creation cycle of the particular company or asset rather than by mandatory fund investment horizons. That seems like common sense to us.