Deals Q&A – Jon Moulton of Alchemy

Jon Moulton

Managing Partner

Alchemy Partners

Jon Moulton founded London-based private equity firm Alchemy in January 1997. The firm has invested £1.9bn of equity in the last 11 years with an emphasis on dealing with troubled companies.

Best known for his abortive attempt to buy MG Rover in 2000, he is also known for his acquisition of a number of British Coal's properties.

Through the years he has transformed a number of publicly quoted struggling companies including pub group Innspired, the accountancy software company Cedar Group and the construction company Avonside.

Alchemy recently completed the raising of a £300m European special opportunities fund.

A chartered accountant, he previously worked with Citicorp Venture Capital in New York and London, Permira and Apax.

What aspects of your job do you enjoy the most?

The diversity. I deal with everything from very early stage fast growing companies to companies with huge technical content, huge pension content.

What key challenges to you anticipate will affect your sector over the next six months?

There is no doubt that deals are going to be very hard to do. Nobody wants to sell a company unless they have to.

You only have to look at the figures – in the first quarter of this year only 10% of the deals that were done in the first quarter of last year were completed.

What key skills do you need in your profession?

The skills that got you through 1991-2 and made a fortune have not been of use in the last few years – it's all been too easy.

When the banks are getting ugly these are the skills you need. It's not a bank offer it's a threat.

If you could improve anything in your sector what would it be?

I would like to eliminate the competition!

Which is the most memorable deal you have worked on?

You would need a lot of your website for that! Some of the mistakes I have made and people I have met have been memorable.

Jacques Margry, who ran Parker Pen for me was a complete gentleman. All his staff loved him, he treated them well and was well respected. You don't find many people like that.

What motivates you?

The fun. I made the money that I needed to make me comfortable a long time ago.

My hobby is investing in small companies. I have made more money out of that than from working. I have many investments, for example, the biggest pub group in Guernsey.

What is the best piece of advice you've ever been given?

To f**k off! Once was to get out of a situation and the other was to leave a bloke to get on with it.

And the worst?

Nearly always from investment bankers! They say when looking at investment opportunities: 'Everybody else has done well out of this, so why don't you?'

Witness this time last year – they said pay the maxiumum for any deal and put as much debt in it has you can.

If you could choose to start your career over again would you do anything different and if so, what?

My God, I have made lots of mistakes. I have lost about one-third of the money I have invested into companies. But I don't lie awake at night thinking: 'I have screwed that up.'

I go to sleep in seconds – my wife worries about it and I put it down to her lack of seductiveness!

Who do you most admire in business and why?

I admire the people who are happy in what they do. Success is not the same as being happy in what you do. I admire the people who have successful objectives, meet them and then relax.

I once worked on a deal where a production director of a firm was going to make £3m out of it. I asked him what he was going to do when it was completed and he said: 'I'm going to trade the wife in for a younger model and f**k off to Portugal!' And he did just that. He's still living there now with a new wife who's about 30 years younger than him!

There are all kinds of people you admire, such as Jacques Margry, the former chief executive of Parker Pen – a complete gentleman, very able businessman and very honest.