Growth fund gears up for £150m London float

Palio, which provides debt finance for private-equity backed deals, is planning a dual listing on the London Stock Exchange’s specialist fund market and the Channel Islands Stock Exchange, reports The Telegraph.

The firm is hoping to capitalise on the decline in banks’ support for private equity buy-outs, which has restricted the number of deals taking place.

Mike Henebery, chief executive of Palio, said the fund could help lift constraints on what he called the UK’s “engine room companies”.
“So many of the banks that used to provide debt to support buyouts are simply out of business and [capital requirement] regulations are making it harder for the rest to do. It’s a huge issue in the buyout world. We think one of the key factors preventing the private equity deal flow recovering is lack of debt capital. That’s creating the business for us.”

He said the listing would allow the company to “deploy capital more quickly. “In the private world, investors prefer the investment to be spread over several years.”

The fund will back buyouts of small and medium-sized companies valued at between £10m and £100m.