Deal Junkie Portfolio Cycling

“In the boom years, along with countless others, I worshipped the god of leverage. In my best year, I made $1.3 billion from merging, floating and spinning off businesses. Then I looked to do it all again. I was always happiest when deals, ideally more than one at a time, were in view. I liked to call what I did visionary and similar in some ways to chess, in that I was always planning the game several moves ahead. I like to think I am good at spotting opportunities and having a sense of how things could turn. If asked about my strengths I’m intuitive – my best results have come when I have followed my intuition, whereas the times I have managed to suppress it have usually ended in disaster. I’m always looking at my portfolio and seeing how I can develop and enhance it, and my time horizon is generally where I want to be in two to five years.”

“So what do they see? A deal junkie who constantly has his eye on the next stage of the plan? A financial manoeuvre that will turn the situation and open up the potential for profit? And what do I think of when I’m in the midst of such a plan? How I can tweak the shape of the business. What can be spun off, demerged or sold? What potential is there for mergers to create larger focused businesses, maybe specific to geographies or sectors? How much leverage can be put on the deal? What is the potential for stock or bond offerings? Which larger investors can be brought in for slices of the action? My eye is always on how I exit. I don’t normally just buy something, hold it for a long time without changing the business and then just sell. What interests me is the evolution, the de-risking, and the stage-by-stage metamorphosis of a business into something that is simply inherently more profitable.”