Tuesday, November 14, 2006

Private equity and German trade fairs?

Just spent the weekend working with clients in Bangkok. Colleague Wolfgang Schelkes of Fair Relations in Germany was there too. In a presentation on the trade fair industry in Europe, he raised a topic I hadn't heard before (I've obviously had my head buried too deeply in Asian matters); the possible privatisation of some of the large German trade fair companies, now almost all owned by city governments.

Many other German government activities have gone this way, but Wolfgang suggests that this may be too difficult for trade fairs because of (a) the complex local politics involved and (b) the size of the required investments. On (a) I am in no position to judge, but I imagine that would be pretty hard. On (b), though, even the largest of the Messe would be a chicken feed investment for one of the big private equity funds now prowling the B2B media world. If KKR can offer $51 billion for Vivendi, then surely even Deutsche Messe AG in Hanover, along with Cologne, Frankfurt, Duessledorf and Munich could all be bought in a single deal by one of these funds without too much of a stretch....

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