RB: 2020 will not be easily forgotten. How has it been for Equistone?
OS: We know how every one of our 50-plus businesses has been impacted, whether positively or negatively. Clearly, it has had an impact on value, but it’s a mixed picture. Some companies will have lost a year in cashflow. Others have had resilient or even stellar performance.
Counter-intuitively, we are finding that some of those hit hardest now appear to have the greatest strategic value and long-term earnings potential. Reshuffling in their sectors provides consolidation opportunities and advantages to those companies who benefit from the strong backbone that we provide.
RB: As we look ahead to 2021, how well is Equistone’s model suited for what comes next?
OS: In the type of environment we are in – one of uncertainty and significant changes within many industries – I think the essential features of our approach matter even more. That means forming trusted partnerships with management teams and working alongside them to create value. We don’t outsource this partnership. When things are tough, an ethos of trust and direct support is more important than ever.
In today’s market, a top tier management team that faces an uncertain environment may see opportunities, but they probably don’t yet know what the specific answers to addressing these are. To have a partner that will work through that with them in a constructive ownership fashion, will be attractive.