BC Partners and Permira See Compensation Falls in 2012Kiel Porter
BC Partners Ltd. and Permira Advisers LLP, two of Europe’s largest private-equity firms, cut compensation for employees last year as revenue declined.
Salaries at London-based BC Partners, which employs about 108 people, fell to 41.3 million pounds ($67 million) for 2012 from 50.3 million pounds a year earlier, according to filings at the U.K.’s Companies House. At Permira, which owns stakes in companies including retailer New Look Retail Group Ltd., pay for its 16 U.K. partners dropped to 21.9 million pounds from 25 million pounds.
Revenue for both companies comes from fees investors pay the firms to manage the private-equity funds on their behalf. The payments typically decline over the 10-year lifetime of a fund as it ceases to make new investments. Both Permira and BC Partners charge an annual management fee of about 2 percent and get to keep 20 percent of the profit from investments.
BC Partners’s revenue from continuing operations, which excludes profit from asset sales, fell to 84.6 million pounds from 95.2 million pounds. Permira’s revenue dropped to 45 million pounds from 49 million pounds, the filings show.
Private-equity firms typically pool money from pension plans and endowments with a mandate to buy companies within five to six years, then sell them and return the money and a profit after 10 years.
The average number of staff employed at BC Partners, which holds a stake in U.K. mobile phone retailer Phones 4U Ltd., dipped from 110 in 2011, the filing shows. A spokesman for the firm in London declined to comment.
The single largest payment made to a partner at London-based Permira fell to 2.3 million pounds from 3.4 million pounds. The recipient was Co-Managing Partner Kurt Bjorklund, said a person with knowledge of the matter, who asked not to be identified because the information is private. Bjorklund didn’t immediately return an e-mail seeking comment, while officials at Permira declined to comment.
BC Partners raised 6.5 billion euros ($8.8 billion) in 2012 for its ninth fund, while Permira is targeting 5 billion euros for its latest pool.
Permira’s accounts reflect its U.K. operation and exclude global revenue and, like BC Partners, don’t include fees derived from asset sales, said one other person briefed on the matter.