Handshakes and kisses are out. Hand sanitizer and air kisses are in. And coughing is a major no-no.
Welcome to the SuperReturn International private equity conference in Berlin, where nervous attendees spooked by the rapidly spreading coronavirus are covering up any fears with gallows humor rather than face masks.
The world’s largest private equity and venture capital event, boasting over 3,000 attendees, turned into a slightly muted affair as many Italian and east Asian investors stayed at home. A few big name guests didn’t turn up, while some withdrew attendees overnight. And others, including some CD&R employees, just dropped out at the last minute.
“This year people are not shouting from the roof top -- it’s a more measured mood in comparison with recent years and the coronavirus is weighing on the atmosphere,” said Richard Hope, head of EMEA at Hamilton Lane.
The organizers, however, said there had been no significant impact on attendance. And to be sure, two of the biggest names in the industry, Apollo Global Management’s Leon Black and Carlyle Group Inc.’s co-founder David Rubenstein did show up.
But the potential impact of the disease was never far from attendees’ thoughts.
After a decade-long tear of blockbuster returns and trillions in new capital from institutional investors, there are now concerns that the China-originated virus will upend global growth -- dealing damage to some of the thousands of firms now owned by the likes of Blackstone Group Inc. and KKR & Co.
Some firms are more vulnerable than others. Portfolio companies dependent on China, reliant on foot-traffic in retail stores, or in the travel industry will be among those impacted badly, Christophe De Vusser, partner at Bain & Co. said in an interview at the conference.
Kewsong Lee, co-chief executive officer at Carlyle, told attendees the short-term economic impact of coronavirus would be greater than people think. He added that in the long run, the global economy would see steady growth.
“You can’t have 40% to 50% of the world’s second largest economy be sequestered in the way it has been and not have an impact,” he said, a reference to quarantine measures in parts of China that have seen factories closed and whole city populations confined to their homes.