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Apollo & RPC Group

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Bottletop
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Apollo & RPC Group

#195554

Postby Bottletop » January 22nd, 2019, 1:05 pm

Hello,
just as a matter of interest, what will a Private Equity Company like Apollo, actually do with RPC Group once they’ve acquired it?
What can the employees expect to happen to them...

Thank you

dionaeamuscipula
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Re: Apollo & RPC Group

#195598

Postby dionaeamuscipula » January 22nd, 2019, 3:07 pm

Bottletop wrote:Hello,
just as a matter of interest, what will a Private Equity Company like Apollo, actually do with RPC Group once they’ve acquired it?
What can the employees expect to happen to them...

Thank you


No experience of Apollo.

PE companies tend to be ultra aggressive. They are there to make money and not there to build a business other than to make more money. Most likely that sacred cows will be questioned, management will be put under massive pressure, delivery against plans will be *required* and the price of failure will be exacted swiftly. No excuses.

For other employees, depends on whether there is fat to be chopped. If there is, it will.

Their aim will be at least a 30% return on funds. Pump the business for all it is worth, make it look sparkly and then sell to a trade buyer.

DM

Lootman
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Re: Apollo & RPC Group

#195600

Postby Lootman » January 22nd, 2019, 3:21 pm

Bottletop wrote:Hello,
just as a matter of interest, what will a Private Equity Company like Apollo, actually do with RPC Group once they’ve acquired it?
What can the employees expect to happen to them...

As a RPC shareholder I am happy about this.

RPC has been something of a dealmaker itself, using rights issues to buy targets and has engaged in a fair amount of financial engineering itself. So that the predator becomes a target is ironic but not disturbing.

PE groups like to sweat the assets but often that happens because existing management isn't getting optimal returns from those assets. Some assets will be stripped out and sold, on the basis that the sum of the parts is worth more than the whole.

As an investor, the fate of the employees is not my primary concern, and doubtless it will be vary depending on what part of the business the worker is in. But if the parts are viable then there should not be any concern for most stakeholders. Middle management might be less lucky but then that is always the case.

In the aggregate I believe that PE groups add value and encourage efficiency and productivity.

Bottletop
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Re: Apollo & RPC Group

#195748

Postby Bottletop » January 22nd, 2019, 11:44 pm

Thanks both, very interesting.
I too have shares in RPC (via a sharesave scheme, bought at 93p per share would you believe?) and, having worked at the Rushden site for six years prior to retirement in 2012, still know people there, hence my interest on two counts. Must say, RPC has served me well.
Thanks again
John


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