Maarten Ruijs: An enduring interest in Asia

Q: What are the top challenges facing the private equity industry right now?

A: I think the key issue private equity faces is making certain that we remain relevant. This means that we continue to out-perform the listed benchmarks and therefore show investors that a long-term commitment to private equity is worthwhile. You should not forget, this is a long-term asset class and investors commit to our funds for 5-10 years. Now is the time to show that while there have been previous crises they have not severely affected the long-term performance of private equity. I personally don't have any doubt about private equity persevering over the long term, but it is something that we will need to prove to drive capital into the industry. That flow of capital is clearly the lifeblood of our business.

Q: CVC has placed a lot of emphasis on Southeast Asia, which is an area that has been slow to pick up a lot of investments. Where do you see the opportunities?

A: I think you have to see our recent commitment to Southeast Asia against the backdrop of our pan-Asian strategy. First, it's our objective to give investors exposure to the region as a whole, and then we go - depending on the countries - and try to find investments that appeal to certain themes. Clearly the investment theme in Southeast Asia is the traditional Asian growth-based investment theme, i.e. rising income. Rising income leads more people entering the middle class, which leads to people spending more. This is particularly the case with our investments in Indonesia. Looking at it from a longer perspective, although there will obviously be some bumps along the way, it is clear this theme is something that will be continue to be relevant over the next 10 years. We are also very happy with our investments in Southeast Asia. They perform very well - most of them above expectations - so it is an area where we are comfortable investing.

Q: Following the global economic downturn, private equity funds have been obliged to rethink their strategies in order to make good on investments and regain momentum. What did CVC do during this period?

Our first objective was to hold on to as many investments as possible by making certain that we would not be faced with covenant breaches. This was achieved by using the very simple strategy of keeping the investments in the portfolio, and we were successful, in most cases. Secondly, we knew we had to continue investing to be successful, so we invested wisely in assets that we thought would perform. This was one of our objectives in 2010. During 2010 we invested 16% of our fund, which is exactly where we should have been on an annual basis, and those investments have continued to perform very well. The third objective was that it was clearly important is to show our investors the relevance of private equity, and the best way to do that is to show exits. Despite the climate, we exited one of our investments in 2009 at a 3x multiple with a 50% IRR, which is clearly very good. Emphasizing the importance of private equity has been the focus of 2011, in addition to finding new investments.

Q: What excites you about private equity in Asia Pacific?

A: Obviously there are many things that excite me because I've been in the field for more than 12 years and I continue to enjoy my job. I think the key attraction to the Asia private equity business is its diversity. It is an industry where you can see an enormous geographic area that is not homogenic and you also get to see the development of many countries. When I think back more than 12 years ago to when I arrived here, it was in the middle of the Korean crisis. Korea last year hosted the G20, and that was a very big difference from where we were.

Q: We know you enjoy being in private equity, but what would you do if you weren't in the industry?

A: I would probably be following one of my own personal objectives, which is to be fluent in an Asian language.

Q: Which language?

A: Difficult to say - Japanese or Cantonese.

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• Topics
• Southeast Asia
• Greater China
• South Asia
• North Asia
• Australasia
• Buyout
• CVC Capital Partners