A group of European private equity firms has started working together to gain more control over the rights and ownership of the debt raised by their portfolio companies. The firms are worried that as their arranging banks sell on the debt, they will lose track of those whose votes they need to change the terms of any deal.

The firms have had two initial discussions but are preparing for more vigorous action early next year, sources party to the conversations said. The group is understood to include 3i, Advent, Apax, Bridgepoint, Candover and Cinven. It is thought some have been hiring debt specialists to provide expertise when negotiating with the banks that arrange the debt. Traditionally, the debt backing a buyout would be bank loans, which would be partly syndicated to their peers, or, if big enough, a public bond would be issued. But banks are moving more or all of the debt on to other parties. One head of leveraged finance said firms were worried if the syndicate changed hands frequently and the end parties were unknown.