From sector depth to long-term partnerships, Hayden Neeland, a Director in Advent’s Sydney office, shares his perspective on private equity in Australia and New Zealand (ANZ), why relationships matter, and how the new office positions the firm for growth.
How does Advent approach investing in Australia and New Zealand? What makes the market attractive?
We are sector specialists who form deep long-term relationships with high-quality businesses and their management teams. We are targeted and disciplined, preferring a bespoke approach to investing across acceleration or transformation – not arithmetic LBOs. Within the ANZ region, our core focus is on the business and financial services and healthcare sectors which display attractive thematics and strong deal volume.
We believe the Australian market is highly attractive and is underpinned by deep talent pools, favorable government incentives that promote innovation, and robust regulatory frameworks. The local economy is very stable and one of the largest M&A markets globally. Over the coming decade, there is a huge opportunity for deployment and a lot of white space in the ANZ region.
What factors are most critical for success in the ANZ region?
I believe there are three key elements to success in the ANZ market. The first is focus – know where you want to play, what differentiates you, and what your strengths are – prioritizing pipeline to where we have a clear right-to-win and differentiated angles. The second is team – create a high-performance team underpinned by a collaborative culture that is integrated into the broader network. Finally – relationships – leveraging local, long term and trusted deal team relationships to unlock opportunities and create proprietary angles. Having a local presence in Sydney makes those connections possible, while the global network helps ensure we can bring our expertise and resources to every opportunity.
How do you think about what makes a strong deal for Advent?
There are fundamental questions we often ask when reviewing opportunities. Does the target have a robust business model? Is there genuine value creation / operating excellence potential? What is the potential for break-out returns? Do we see an attractive and viable exit pathway? What is our right-to-win and do we have a proprietary angle? If we can get comfort early on with these questions, we know the deal has significant potential and we should move to the next stage.
Within healthcare, our focus is on services which we believe display higher growth and margin characteristics. We are quite interested in pharma services in addition to medical technology. On the BFS side, there are a number of attractive sub-sectors, including innovative payment propositions, fintechs in the lending space, and wealth management.
What is your long-term outlook for private equity in Australia, and what role does Advent aim to play?
The outlook for private equity investment in Australia is very strong. It is an attractive macro-economic environment, and the political and regulatory system is sophisticated and stable. Combined with the fact Australia produces high quality businesses, we believe there is a huge opportunity for deployment.
For Advent, establishing the Sydney office in 2024 marked an important step. It allows us to build a local team, shape a culture, and strengthen our relationships, all while leveraging the firm’s global expertise and Operating Partner network. I am excited about the chance to grow our presence in ANZ, contribute to Advent’s broader Asia strategy, and help accelerate the development of private equity in the region.
