Listing rules in Hong Kong, for example, have deterred some private equity houses from exiting with IPOs.
"Such rules don't really exist in the US – they are not in the listing rules," said Michael Weisser, private equity partner at Weil Gotshal & Manges. "Underwriters do require a lock-in period of six months, but this is completely customary and wouldn't scare private equity from a partial exit."
Many US private equity houses are deliberately opting against 100% exits at the moment as they need to raise capital quickly, but wish to retain a stake in the portfolio company. IPOs are likely to provide the best value in these situations.
"Private equity firms have any number of portfolio investments for which an IPO would...