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PRESS RELEASE


Good News from Germany:
Locust Funds Begin Pull-Out

July 7 (EIRNS)—The prospect of new legislation regulating activities of hedge funds and private equity funds in Germany, and the flop of speculative profit expectations, especially on the German housing and real estate market, apparently have led fund managers to the conclusion that "this is no good country to stay in." That is also the conclusion in an international overview report for the private equity sector, just published in London, and reported in the economics section of the Frankfurter Allgemeine daily, today: Germany is getting a very negative rating, because of "excessive regulation of the labor market, too high wages, and the tax burden on enterprises." For equity funds, conditions on the German market are "outspokenly miserable," the report assesses. Another problem for funds is that German enterprises are overly "oriented towards the employees, labor unions, clients and the influence of the state, and never focus on the interests of the shareholders."

Cerberus is already pulling out, selling about 30,000 flats owned by its daughter firm Baubecon; so also Goldman Sachs, is announcing the sale of corporate real estates just purchased in early May. The U.S. fund Oaktree also sold flats, and other funds are said to be following soon.