Candover Makes Sweeping Management Changes

LONDON (Reuters) – British private equity firm Candover Investments (CDI.L) announced a major management shake-up on Friday as it looks to repair its damaged reputation and salvage its 2008 fund.

Former driving force Colin Buffin, who has been with the firm since 1985, will step down once talks over the future of the fund are concluded.

Marek Gumienny will become chairman of Candover Partners, the private equity subsidiary that makes all the firm’s investments, while John Arney becomes managing partner.

Candover’s complicated structure — with a listed parent and an independent but wholly-owned fund manager — came in for intense criticism when the group earlier this year said it could no longer invest in its own fund.

The 2008 fund was launched and part-raised but never closed.

When Candover Investments defaulted on its commitment, the fund manager was obliged to ask investors — who had already pledged some 2 billion euros ($2.85 billion) — if they wanted to withdraw their original commitments.

Candover expects to conclude discussions with investors in the weeks ahead, which it hopes will lead to the emergence of a smaller than originally planned 2008 fund.

Candover in June called off talks over a sale of the company and said it expected to meet debt covenants after the sale of energy research business Wood Mackenzie to rival Charterhouse [CHCAP.UL], for 553 million pounds ($913.4 million).

Despite the proceeds from the sale, Candover said it would not be offering an interim dividend. It said net asset value had fallen 12 percent to 902 pence since end-December.

Candover also said finance director Tian Tan has retired, with Matthew Harrison assuming the role, while Matthew Fallen, who led the strategic review, has been confirmed as CEO of Candover Investments.

Shares in Candover Investments rose 3.3 percent to 411 pence at 0732 GMT in low volumes.

(Reporting by Simon Meads; Editing by Douwe Miedema)