HgCapital Trust plc Regulatory News (HGT)

HgCapital Trust adds to NAV per share from sale of Parts Alliance

1 June 2017: HgCapital, the Manager of HgCapital Trust plc (the "Company"), has announced that it has agreed the sale of Parts Alliance, a UK automotive aftermarket parts distributor, to Uni-Select Inc., a listed Canadian distributor of automotive refinish and industrial paint products and aftermarket parts for a transaction value of £205 million.

The sale of Parts Alliance delivers a c. 2.0x investment multiple and a c. 19% gross IRR over the investment period.

The Company, whose shares are listed on the London Stock Exchange, gives private and institutional investors the opportunity to participate in all HgCapital's investments. The Company will realise cash proceeds of approximately £21.3 million on completion of this transaction. This represents an uplift of £6.7 million (46%) or 18 pence per share over the carrying value of £14.6 million in the Net Asset Value ("NAV") of the Trust at 30 April 2017 which was based on the Directors' valuation as at 31 December 2016.

Based on the pro-forma 30 April 2017 reported NAV, (including the impact of the revaluation of the carried interest provision), the pro-forma NAV of the Trust is expected to be £613.5 million (or 1,643.7 pence per share). The Company's liquid resources available for future deployment including all announced transactions are estimated to be £136 million (22% of the pro-forma 30 April 2017 NAV). In addition, the Company has access to a £80 million standby facility, which is currently undrawn.

HgCapital announces sale of Parts Alliance to Uni-Select Inc.

§ Thirteenth realisation from HgCapital 6 Fund, delivering a c. 2.0x investment multiple and c. 19% gross IRR

§ HgCapital has returned over £1.5 billion to clients over the last twelve months with eight exits and multiple portfolio re-financings since the Brexit vote

§ Third realisation by HgCapital in the last 5 months, delivering an aggregate investment multiple of 2.9x

1 June 2017: HgCapital is pleased to announce that it has agreed the sale of Parts Alliance, a UK automotive aftermarket parts distributor, to Uni-Select Inc., a listed Canadian distributor of automotive refinish and industrial paint products and aftermarket parts, for a transaction value of £205 million.

HgCapital initially invested in Parts Alliance in August 2012. Over the course of the investment period, the group has expanded through a series of HgCapital-led acquisitions in the space, ultimately creating a broader group of thirteen parts distributors (ten of which are owned by Parts Alliance), with a combined group turnover of c.£450 million. Customers range from independent garages to multi-branch workshops and fast-fits, and they are served by a fleet of over 1,000 vehicles and more than 2,900 staff across the group membership.

The enlarged group is now one of the largest players in the sector, which helped to materially increase Parts Alliance's appeal to both European and North American buyers seeking a scale, platform asset to enter the UK aftermarket car parts sector.

The realisation of Parts Alliance represents the thirteenth realisation from the HgCapital 6 Fund (2009), which has now delivered overall realised returns of 2.3x and a 24% gross IRR. The Fund has now returned in cash 130% of the original investment made. This sale follows the successful exits of Zenith (2.9x / 47% IRR) and QUNDIS (3.5x / 30% IRR) which completed earlier this year, and a number of further realisations from HgCapital 6 are anticipated over 2017.

Martin Block, Partner, HgCapital, said: "We are delighted with the sale of this very special business to Uni-Select. They will be a fantastic partner for the next phase of Parts Alliance's continued growth and development. As a buy and build in a fragmented and dynamic sector, our management team were able to create a business of scale and real capability through their drive, professionalism and determination. Parts Alliance brings together a high-quality group of distinct brands with a common culture and local identity. We wish both the team and the new owners every success for the future."

Peter Sephton, CEO at Parts Alliance commented: "This has been a fantastic journey, building a sector leader in just over 4 years with 10 acquisitions and driving above average organic growth. I and our management team would like to thank HgCapital for all their support as I and our 2,900 colleagues look forward to continuing that journey with Uni-Select, helping build a great international auto parts business together with the Uni-Select leadership team."

Henry Buckley, President and CEO at Uni-Select Inc. added "We are excited to establish a third growth pillar in the large UK parts aftermarket, one of the most fragmented in Europe, with significant potential for consolidation. Parts Alliance is a great organization, with a market leadership position, a proven growth platform and an experienced management team that has demonstrated its ability to drive profitable growth both organically and through acquisitions. Our two companies are a perfect fit in terms of business profile, customer focus, entrepreneurial culture and commitment to people development."

HgCapital were advised by Baird and White & Case LLP

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About HgCapital Trust plc

HgCapital Trust plc is an investment trust whose shares are listed on the London Stock Exchange (ticker: HGT.L). The Company is a client of HgCapital, giving investors exposure to a portfolio of high-growth private companies, through a liquid vehicle. New investments and existing portfolio companies are managed by HgCapital, an experienced and well-resourced private equity firm with a long-term track record of delivering superior risk-adjusted returns for its investors. For further details, please see www.hgcapitaltrust.com.

Neither the contents of HgCapital Trust's, HgCapital's, Parts Alliance's, nor Uni-Select Inc.'s websites nor the contents of any website accessible from hyperlinks on the websites (or any other website) is incorporated into, or forms part of, this announcement.