“Pre-Empting The Tactics Of Private Equity May Be Best Way To Enhance Shareholder Value, Finds Booz & Company”
In a January 5, 2009 article in Maktoob Business (UAE), Booz & Company Principal Ahmed Youssef (Middle East) detailed a new Booz & Company report that urges management of public companies to adopt the tactics of private equity to raise share prices and make themselves less vulnerable in hard times. Youssef said that publicly traded companies are often outmaneuvered by private equity firms that swoop in, buy them, and resell them at a premium often after only a short holding period—and should consider using a similar strategy. The report, “Pre-Empting Private Equity: Six Ways to Enhance Value,” highlights the steps companies can take, including shedding non-core parts of their portfolios, rewarding shareholders with dividend increases and stock buybacks and optimizing their capital structures. “The growth in this part of the world has been tremendous over the last few years, but people aren't really thinking about the practices that maximize value and assure sustainability,” said Youssef. “These practices are critical in tough times.” (The Booz & Company study was also featured in a January 5, 2009 article in the Middle East North Africa Financial Network of Jordan.)