The head of one of the UK's largest investors in private equity has warned the "flawed" alignment of interest between large buyout funds and their investors could lead to lower returns.
Rod Selkirk, a former chairman of the UK's industry trade body and the chief executive of Hermes Private Equity, the asset management arm of the BT and Royal Mail pension schemes, said: "The model [between fund manager and investor â called general partner and limited partner, respectively] is well tried and tested but flawed for large funds. But there will be no short-term shift [in this dynamic]."
