Our CEO Luncheon Series continued on February 9th with the spotlight on OFS private equity pioneer L.E. Simmons. Mr. Simmons described the genesis of SCF Partners and the early decision to pursue a company-building path over a more traditional investment-centric model. Over more than 25 years, SCF’s unique strategy has been the foundation and incubator for OFS household names such as Weatherford, NOV, Grant-Prideco and Hornbeck Offshore among others. Mr. Simmons stressed global reach over geographic concentration as one of the hallmarks of good companies. Additionally, he believes a focus on doing a few things well vs. “dabbling” in a lot of things creates durable, nimble and more valuable enterprises. As Mr. Simmons sees it, the current environment presents considerable challenges, particularly for private equity firms struggling to deploy massive amounts of capital and generate competitive returns. Against that difficult backdrop he believes, as in cycles past, the inherent elevated volatility and extreme dislocation will reveal opportunities to buy good companies (i.e., solid cash flow dynamics) at deeply discounted prices.
Maynard Holt, L.E. Simmons, Byron Pope
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