Anthony Hilton: Journalism is not advertising

Private equity funds have a ten-year life cycle, meaning they are expected to have returned investors' cash, hopefully with profit, at the end of that period. Because it takes time to find investments, funds are seldom fully invested much before year four.

Anthony Hilton: Journalism is not advertising
Anthony Hilton: Journalism is not advertising

Similarly, the managers like to phase the disposals to reassure investors they are making profits and soften them up.

These mathematics dictate that the typical private equity holding in a company is no more than five or six years. If all goes according to plan,this gives them time to find management, refine the strategy and deliver enough years of growth to be able to sell it well.

It follows from this that when a journalist gets a call from a PR consultant to 'tell them a bit more' about a company that has been owned by private equity for the past four years, the subtext is the business is being groomed for sale. This is doubly so in the UK, where there is no mainstream writing about management, strategy or any of the things that make a business tick. We don't have a business press; we have a financial press - one focused on the City, the markets and economics.

If companies are not part of the financial scene, then in national newspaper and broadcast journalism they don't get written about. The only exception is when they have done something wrong.

So the only reason a PRO would think a journalist would need to 'know a bit more' about a company would be if it was beginning to think about putting itself up for sale. It hardly makes for great journalism but it can fill a hole on a slow day. The trouble is, too many private equity companies and their PR advisers are forgetting that even the most boring article needs some point. There is a requirement for the interviewee to say something - anything - interesting beyond the trite cliches like 'we are focused on growth', let alone outright lies like 'I haven't given any thought to a sale'.

There is still a difference between business journalism and advertising. When chief executives don't make the effort, it suggests they don't understand this - which is a bit of an indictment of the PR adviser.

Anthony Hilton is City commentator on London's Evening Standard

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