Sponsors are likely to change the way they source and assess potential investments after the pandemic-related dislocation begins to ease, several sources told PE Hub.
“I don’t think PE investors think too much about the supply chain,” said Hugh MacArthur, the partner who leads Bain & Company’s Global Private Equity Practice. “They want a very high service level and a low cost,” he said.
But that’s changing, according to MacArthur. “Now we are realizing that PE investors also need to play defense,” MacArthur said. Sponsors in the aftermath of coronavirus will examine how efficiently a company handles risks and the vulnerabilities in the supply chain before executing acquisitions.