ICP.L Regulatory News (ICP)

6 Jun 2006 07:02

Intermediate Capital Group PLC06 June 2006 Embargoed until 7.00am onTuesday 6 June 2006 PRELIMINARY RESULTS FOR THE FOURTEEN MONTHS ENDED 31 MARCH 2006 Intermediate Capital Group PLC ("ICG"), the leading independent specialistEuropean provider of mezzanine finance, announces its results for the fourteenmonths ended 31 March 2006. Financial highlights: 14 months to 12 months to Annualised 31 March 06 31 January 2005 % increaseCore Income* £106m £75m 22%Gains on investments £145m £63m 98%Pre-tax profits £190m £95m 72%Earnings per share 179p 89p 74%Total dividend proposed forperiod 56p 40p 20%Loan book £1.5bn £1.2bn 21%** * The composition of core income can be found as part of the analysis of profit before taxation. ** Actual increase, based on like for like IFRS amounts These results are for a fourteen month period and have been prepared under IFRSfor the first time. In commenting on trends in performance throughout thisannouncement we have calculated the annualised percentage increases to makecomparisons more meaningful. Operational highlights: • A record £899m of financings arranged or provided during the year in 37 companies; • Funds under management rise to £3.0bn; • A substantial increase in debt facilities to fund the future growth of the business; Commenting on the results, John Manser, Chairman of ICG, said: "It gives me great pleasure to report outstanding results from ICG. Core income showed strong growth, increasing by 22%. Gains on investmentsdoubled those of any previous year, leading to record pre-tax profits. We alsoachieved growth in the loan book in an active and competitive market despiterejecting record numbers of potential new deals on the grounds of excessiverisk. We launched an innovative new fund, the EuroCredit Opportunities Fund, andcontinue to see other good fund management opportunities. We expect buyout markets to continue to grow, fed by record levels of privateequity funding and fuelled by high levels of liquidity in the current debtmarkets. This is likely to lead to further growth in demand for mezzanine andopportunities for ICG, which, along with continued momentum from last year,leads us to be confident for prospects in our core income and the future of ourbusiness." Enquiries: Tom Attwood, Managing Director, Intermediate Capital Group PLC (020) 7628 9898 Paul Piper, Managing Director, Intermediate Capital Group PLC (020) 7628 9898 Gill Ackers/Helen Barnes, Brunswick Group Limited (020) 7404 5959 An interview with Tom Attwood, Managing Director, Intermediate Capital GroupPLC, in video, audio and text format is available at www.icgplc.com and atwww.cantos.com Note to the Editors A brief explanation of Intermediate Capital Group PLC's lending activities isattached. Results Pre-tax profits for the fourteen months ended 31 March 2006, prepared under IFRSfor the first time, increased by 72% to £190m as a result of record gains oninvestments and another period of strong growth in core income. Core income, the most important element of ICG's profits, which is defined asnet interest income plus fee income less related administrative expenses, grewto £106m, an increase of 22%. Net interest income rose by 42% to £124m as aresult of the further growth in the loan portfolio, the continuing use ofrolled-up interest in many of the mezzanine loans in our portfolio and theinclusion of underwriting fees. Total fee income fell by 13% to £28m for theperiod due to a lower level of arrangement fees and the exclusion ofunderwriting fees which are now part of net interest income. However, our fundmanagement fees increased by 12% to £23m due to the increase in funds undermanagement over the last 18 months. Administrative expenses increased by 41% to£46m, owing to increased bonuses, other staff costs and the partial recognitionfor the first time of bonuses not payable until future years. We achieved record gains on investments for the period of £145m, which were morethan double those of last year. £138m of these gains were received in cash withthe balance being the change in the market value of certain unrealised warrants. Dividends The Board is recommending a final dividend of 42p net per share which, with theinterim dividend of 14p net per share, brings the total for the year to 56p netper share, an annualised increase of 20% over last year's dividend, reflectingthe strength of performance of both core income and net gains on investments.Dividend cover is 3.2 times post tax earnings. Our objective remains to provide double digit dividend growth followingcontinued growth in core income. The dividend will be paid to shareholders on the register on 7 July 2006. The Portfolio We had another strong period of new lending which resulted in our loan bookgrowing by 21% over the period to £1.5 billion, a new record. During the periodwe arranged or provided a total of £899m in 37 new loans and investments. £535mwas invested on our balance sheet (£409m in 2005) and £287m taken by fundmanagement clients (£283m in 2005) with the balance being syndicated to thirdparties. Included in these figures is £88m which we invested in the equity of 22companies, increasing this portfolio to £221m. The UK and France continue to be the most active markets for new investmentsalthough this year there were encouraging signs of greater activity in otherparts of Continental Europe, most notably Scandinavia and Benelux. We also madeour first investment in Central Europe in the leading Polish cable TV operator. Loan repayment levels were particularly high at £335m, 27% of the opening loanbook, as private equity sponsors sought to realise investments in a buoyantmarket for exits. These sponsors also took advantage of strong debt markets tore-leverage existing companies at a lower cost and to realise equity value.Consequently, a further £358m of ICG's portfolio was refinanced with ICG broadlymaintaining its exposure. These transactions have had the effect of raising therisk profile of our portfolio by replacing lower geared and, generally, highermargin deals with higher geared, lower margin deals. These refinancings havetended to be from our better performing and highest quality borrowers. Our portfolio has performed well during the year, leading to net provisions of£27m which equates to less than 2% of the loan book. We also took advantage ofthe developing secondary market for mezzanine assets to sell a number of ourunderperforming loans; this has had the effect of considerably improving thequality of our portfolio. At the end of March, the mezzanine portfolio comprised loans to 88 companies. Itcontinues to be well diversified and is spread over 25 industries and 14countries. The top twenty companies measured by original investment account for£667m of the loan book and are performing satisfactorily. Funding In April 2005, we took advantage of the attractive borrowing conditions in thedebt markets and raised a new £845m revolving credit facility, replacing allexisting bank facilities and providing an additional £473m of facilities toenable ICG to benefit from future opportunities in the mezzanine market. At 31March 2006, we had unutilised facilities of £470m available for futureinvestment. The gearing ratio remains relatively modest at 2:1, with outstanding borrowingsat the end of the financial year of £981m. Fund management The Mezzanine Fund 2003 has now invested approximately 70% of the available€1.5bn. We are pleased with the quality of the investment portfolio in terms ofgeography, sector diversity and credit quality. Our 1998 Mezzanine Fund achievedits hurdle rate for investors and has started to make carried interestdistributions. Mezzanine Fund 2000 is performing well. We are also pleased to have raised the first dedicated mezzanine fund for theAsia Pacific market at US$500m, of which ICG will co-invest 40%. In November, we raised Eurocredit Opportunities I Plc, a fund which invests in adiversified portfolio of sub-investment grade loans and bonds with an initialsize of €400m. This fund has a flexible financing structure to enable it to takeadvantage of the volatility in European credit markets and maximise returnsacross the credit cycle. The fund is open-ended and a further €275m has beenraised since the end of March. The CDOs and Leveraged Loan funds continue to perform well although, in thisbenign economic environment and with default levels at record lows,differentiation between good and poor fund manager performance can be difficult. The European mezzanine market 2005 was a buoyant year for the European mezzanine market with investment levelsreaching €9bn, a 75% increase on 2004. This mezzanine market growth has beendriven by the strong leveraged buyout market in which private equity sponsorsraised record funds of €72bn during the year. As default rates remained low, competition for mezzanine loans intensified witha significant number of hedge funds and CDOs entering the market, attracted bythe high yielding nature of mezzanine investment. This competitive activity ledto increases in leverage and therefore risk. We now see an imbalance betweenrisk and reward, with little margin for safety in a number of transactions. Thepressure on borrowers, however, has been reducing, in part due to the trend toreplace amortising loans with loans with a fixed repayment date, thus deferringthe repayment requirements and improving cash flows. In these market conditions,ICG has continued to be highly selective in its investment, rejecting recordnumbers of potential new deals on the grounds of risk and structure and hastherefore experienced a reduced share of what has become a much bigger market. The Asia Pacific mezzanine market The Asia Pacific buyout market continues to develop with increased dealopportunities being generated both in the mid-cap and larger buyout markets. Anumber of European and American private equity sponsors are moving into theregion and local equity funds have been actively fundraising. We are thereforein a strong position to capitalise on these existing ICG relationshipsnotwithstanding the emergence of new mezzanine and hedge funds. We remain optimistic about the growth potential of the buyout market andconsequently the opportunities for mezzanine investment. Offices, management and staff In November 2005, we announced the creation of a management committee comprisingthe most senior executives of the firm. The management committee is responsiblefor formulating strategy and product and pricing policies. As part of our commitment to the wider community, we have introduced a corporateand social responsibility programme. This programme has involved employees beinginvolved in various activities to the benefit of local charitable organisations. ICG's success depends on the quality of its people and I would like to take thisopportunity, on your behalf, to thank all of the team for their outstandingcontribution to this period's performance. The Board In February 2006, we were pleased to announce the appointment of Justin Dowleyas a Non-Executive Director of the company and he was appointed independentChairman of the Audit Committee in May 2006. Justin is a Partner in TricornPartners LLP and was formerly Head of Investment Banking and M&A at MerrillLynch Europe. The Board will benefit from his extensive senior managementexpertise and his breadth of knowledge of financial services. We are also pleased to announce the appointment of Philip Keller as FinanceDirector. He is currently the Finance Director of ERM, a leading environmentalconsultancy firm and qualified as a chartered accountant in 1990. He will jointhe Board in September. John Curtis, our Chief Financial Officer and Company Secretary, will retirelater this year. I would like to thank John for his hard work and enormouscontribution to ICG since its foundation in 1989. Corporate identity During the year, we commissioned international research among our clients. Thedetailed findings have helped us focus even closer on the issues and qualitiesthat count. We have developed a new website which will incorporate a secureextranet for fund investors and have also redesigned our logo. Prospects In the short term we anticipate further growth in the leveraged loan andmezzanine markets, as private equity houses focus on investing their newlyraised funds. Competition amongst private equity sponsors is unlikely to abateand so prices will continue to be high, leading investors to optimise financingstructures in order to protect returns. We expect mezzanine, available inincreasingly large amounts, to remain the most flexible and preferred form ofsubordinated debt. Despite competitive conditions, we expect to see good investment opportunitiesboth for the balance sheet and the fund management businesses due to ouradvantages of having skilled executives with long-term relationships in localmarkets and a long-term approach to investment. Our strong credit culture willensure that, in a market of increased risk, investment will be focused onquality business opportunities that offer a reasonable balance of risk andreturn. We will not forego credit quality and longer-term returns for the sakeof increasing the loan book. In the current year we have to date invested £116mon our balance sheet in six transactions. With regard to repayments and refinancings, we anticipate that these willexperience some slowdown as the majority of private equity investors havealready taken advantage of the aggressive debt markets to re-leverage portfoliocompanies. Future recapitalisations will therefore depend more upon strongfinancial performance by companies rather than a further increase in leveragelevels. Repayments so far this year amount to £39m. Notwithstanding the increased level of leverage and risk in the mezzanine marketwe are very pleased with the overall quality and performance of our portfolio. Gains on investments in the last two years have reached record levels as aconsequence of the companies that deferred exits in 2002 and 2003. Although weexpect continued strong gains from the portfolio, we do not anticipate thatfuture gains will reach these exceptional levels. Fund management income is also expected to demonstrate good growth on the basisof both funds raised during the last year and the opportunity to raise furtherfunds this year. We are currently in discussions to manage sub-investment gradeloan and bond portfolios on behalf of a number of third parties and anticipatethat there will continue to be similar opportunities to capitalise on ourexperience and to diversify our product range and client base. Debt markets, like most other capital markets, have historically been cyclicaland we believe they will continue to be so. In the medium-term we anticipatethat the coincidence of higher default rates, driven by high levels of LBOleverage with limited cushion for error, and the short term time horizons ofsome of the new entrants to the market will, at some stage, take the heat out ofthe mezzanine market. Given the trading mentality of some of the new marketparticipants we expect a reversal in the market conditions to lead to increasedvolatility. This volatility should provide interesting opportunities forlong-term investors such as ICG. In the mean time, we expect buyout markets to continue to grow, fed by recordlevels of private equity funding and fuelled by high levels of liquidity in thecurrent debt markets. This is likely to lead to further growth in demand formezzanine and opportunities for ICG which, along with continued momentum fromlast year, leads us to be confident for prospects in our core income and thefuture of our business. INTERMEDIATE CAPITAL GROUP PLCCONSOLIDATED INCOME STATEMENTFor the fourteen months ended 31 March 2006 Period ended Year ended 31 March 2006 31 January 2005 £m £m (unaudited) (audited) ---------------------------------- Interest and dividend income 170.7 101.6Gains on investments 144.9 62.9Fee and other operating income 27.8 27.4 --------------- --------------- 343.4 191.9Interest payable and other related financingcosts (52.7) (26.5)Provisions for impairment of assets (27.3) (28.2)Administrative expenses (73.3) (42.2) --------------- --------------- Profit before tax 190.1 95.0Tax expense (65.0) (33.5) --------------- ---------------Profit for the period attributable to theequity shareholders 125.1 61.5 --------------- --------------- Earnings per share 179.3p 88.6p As permitted by the transitional rules on first-time adoption of IFRS, the 2005statutory comparatives have not been prepared in accordance with IAS 32"Financial Instruments: Disclosure and Presentation" and IAS 39 "FinancialInstruments: Recognition and Measurement", but instead follow applicable UK GAAPrequirements. INTERMEDIATE CAPITAL GROUP PLCANALYSIS OF PROFIT BEFORE TAX:For the fourteen months ended 31 March 2006 Period ended Year ended 31 March 2006 31 January 2005 £m £m (unaudited) (audited) ----------------------------------Income Interest and dividend income 170.7 101.6Fee and other operating income 27.8 27.4 --------------- -------------- 198.5 129.0Less: related expensesInterest payable and other related financingcosts (46.2) (26.5)Administrative expenses-Salaries and benefits (19.8) (13.3)Operating expenses (13.0) (8.3)Medium Term Incentive Scheme (13.2) (6.3) --------------- --------------Core Income 106.3 74.6 =============== ============== Gains on Investments 144.9 62.9Medium Term Incentive Scheme (27.3) (14.3) --------------- --------------Net Gains on Investments 117.6 48.6 =============== ============== Provisions against loans and investments (27.3) (28.2) Gains less losses on derivatives for hedgingpurposes* (6.5) - --------------- --------------Profit on ordinary activities before taxation 190.1 95.0 =============== ============== * This is included in interest payable in the statutory income statement. It isnot considered part of core income as it relates to movement in the fair valueof derivatives used to hedge certain liabilities of the group excluding anyinterest accruals and spot f/x translation movements on the derivatives whichremain within interest payable. CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSEFor the fourteen months ended 31 March 2006 Period ended Year ended 31 March 2006 31 January 2005 £m £m (unaudited) (audited)Available for sale investments:Valuation gains/(losses) taken to equity 23.5 -Transferred to profit or loss during the period (31.3) - Tax on items taken directly to or transferred from equity 2.2 - -------------- -------------Net income recognised directly in equity (5.6) -Profit for the period 125.1 61.5 -------------- -------------Total recognised income and expense for theperiod attributable to shareholders 119.5 61.5 -------------- ------------- Note : The effect of adoption of IAS 32/39 on shareholder's equity at 31 January2005 was £20.1m. INTERMEDIATE CAPITAL GROUP PLCCONSOLIDATED BALANCE SHEET 31 March 2006 31 March 2006 31 January 2005 £m £m (unaudited) (audited) Non-current assets 1.1 1.3Property, plant and equipmentFinancial assets: loans and investments 1,493.9 1,182.8other derivatives 20.8 -Deferred tax asset - 0.8 -------------- ------------- 1,515.8 1,184.9 Current assetsTrade and other receivables 10.9 20.2Financial assets: loans and investments 70.6 40.9Cash and cash equivalents 52.4 55.6 -------------- ------------- 133.9 116.7 Total assets 1,649.7 1,301.6 -------------- ------------- Equity and reservesCalled up share capital 14.0 13.9Share premium account 174.5 172.5Capital redemption reserve 1.4 1.4Other reserves 6.4 0.5Retained earnings 297.0 191.6 -------------- -------------Equity shareholders' funds 493.3 379.9 Non current liabilities Financial liabilities 719.0 711.4Deferred tax liabilities 16.8 - -------------- ------------- 735.8 711.4Current liabilities Trade and other payables 69.4 58.9Financial liabilities 331.6 131.5Liabilities for current tax 19.6 19.9 -------------- ------------- 420.6 210.3 -------------- -------------Total liabilities 1,156.4 921.7 -------------- ------------- Total equity and liabilities 1,649.7 1,301.6 -------------- ------------- INTERMEDIATE CAPITAL GROUP PLCCONSOLIDATED CASH FLOW STATEMENT For the fourteen months ended 31 March 2006 Period ended Year ended 31 Mar 06 31 Jan 05 £m £m (unaudited) (audited)Net cash from operating activities Interest and fee receipts 158.0 116.9Dividends received 7.1 0.9Gain on disposals 138.1 62.9Interest payments (40.6) (24.4)Cash payments to suppliers and employees (48.8) (28.9)Purchase of loans and investments (657.3) (398.6)Purchase of current financial assets (29.2) (14.2)Proceeds from sale of loans and investments 407.9 311.7 ------------ -----------Cash generated by operations (64.8) 26.3Taxes paid (60.2) (26.5) ------------ -----------Net cash used in operating activities Investing activities (125.0) (0.2)Purchase of property, plant and equipment (0.6) (0.3) ------------ -----------Net cash used in investing activities Financing activities (0.6) (0.3) ------------ -----------Dividends paid (29.4) (24.9)Increase in long-term borrowings 147.2 29.1Increase in bank overdrafts 2.5 10.7Proceeds on issue of shares 2.1 2.6 ------------ -----------Net cash from financing activities 122.4 17.5 ------------ -----------Net (decrease)/increase in cash (3.2) 17.0 ------------ -----------Cash and cash equivalents at beginning of period 55.6 38.6 =========== ===========Cash and cash equivalents at end of period 52.4 55.6 =========== =========== This announcement is prepared on the basis of the accounting policies as amendedfollowing the introduction of IFRS. These policies are as stated in ourtransitional statement which was published in September 2005. While thefinancial information included in this preliminary announcement has beencomputed in accordance with IFRS, this announcement does not itself containsufficient information to comply with IFRS. The Group expects to publish fullfinancial statements that comply with IFRS in June 2006. The financial information set out in the announcement does not constitute thegroup's statutory accounts for the period ended 31 March 2006 or the year ended31 January 2005. The financial information for the year ended 31 January 2005 isderived from the statutory accounts for that year, as restated to comply withIFRS, which have been delivered to the Registrar of Companies. The auditorsreported on those accounts; their report was unqualified and did not contain astatement under s237(2) or (3) Companies Act 1985. The statutory accounts forthe fourteen months ended 31 March 2006 will be finalised on the basis of thefinancial information presented by the directors in this preliminaryannouncement and will be delivered to the Registrar of Companies following thecompany's annual general meeting. NOTE TO THE EDITORS ICG's principal business is to arrange and provide mezzanine capital forcompanies in Europe and the Asia Pacific Region. ICG has offices in London,Paris, Stockholm, Madrid, Frankfurt and Hong Kong. ICG also has a specialistfund management business relating to higher yielding European debt. ICG makes mezzanine loans from both its own resources and from third party fundsunder its management. Mezzanine finance ranks in terms of risk and rewardbetween bank debt and equity capital. In return for providing finance, ICG seeksa strong cash yield and an additional return related to the success of theinvestee company. Mezzanine finance has been principally used to financemanagement buyouts but is also used as acquisition and refinancing capital. In the 14 months ended 31 March 2006 ICG and its mezzanine funds invested in thefollowing companies: Acteon is the leading French manufacturer of small dental equipment andconsumables. In December 2005 ICG arranged and provided mezzanine finance of€16m to assist in financing the secondary buyout. ICG also invested €8m in theequity. A-Katsastus is a Finnish company that provides vehicle inspection services. InMarch 2006 ICG took a participation of €22m in the mezzanine loan provided toassist in the buyout. Aster is a company that provides cable television and broadband internet andtelephony services in Poland. In March 2006 ICG took a participation of €26m inthe mezzanine facility provided to assist in the secondary buyout. ICG also tooka participation of €4m in the equity. Aviagen is the world's leading breeder of poultry stock for meat production. InJune 2005 ICG took a participation of US$ 36m in the mezzanine finance arrangedto assist in the acquisition by The Wesjohann Group, a German company. Aviapartner, a company based in Belgium, is one of the leading providers ofairport ground handling services. In September 2005 ICG arranged mezzaninefinance of €22m to assist in the buyout. AVR is the largest waste management company in The Netherlands. In March 2006ICG arranged senior shareholder loans of €149m to assist in the buyout. ICG alsoinvested €25m in the equity. Caradon, a U.K. company, is a manufacturer of boilers and radiators. In July2005 ICG took a participation of £15m in the mezzanine facilities arranged toassist the secondary buyout. Carema, a Swedish company, provides healthcare and care services in the Nordicregion. In July 2005 ICG arranged mezzanine facilities of SEK 150m to assist inthe buyout. ICG arranged an additional SEK 14m facility in January 2006 toassist with an acquisition. Courtepaille is a leading chain of grill restaurants based in France. In June2005 ICG took a participation of €16m in the mezzanine financing arranged toassist in the secondary buyout. Dometic, a Swedish company, is a supplier of appliances for recreationalvehicles. In June 2005 ICG took a participation of US$ 123m in the mezzanineloan arranged to support the secondary buyout. Famosa is the largest toy manufacturer and distributor in Spain. In September2005 ICG arranged and provided a mezzanine loan of €20m to assist in thesecondary buyout. ICG also invested €1m in the equity. Fitness First is the leading health club operator in the U.K. In December 2005ICG took a participation of £18m in the mezzanine facility provided to supportthe buyout. We also made an equity investment of €3m. Geoservices, a French company, is a service provider in the upstream oilindustry. In July 2005 ICG arranged and provided mezzanine finance of €30m toassist in the buyout. Geoxia, a French company, is a leading house builder. In March 2006 ICG arrangedand provided a mezzanine facility of €16m to assist in the secondary buyout. Himart is South Korea's largest chain of electronic speciality stores. In March2005 ICG arranged and provided mezzanine facilities of Won 80bn to assist in thebuyout. HMY, a French company, is a provider of shelving equipment, checkout countersand point of purchase items. In March 2005 ICG took a participation of €20m inthe mezzanine finance arranged to assist the secondary buyout. Lariviere, a French company, is a distributor of roofing materials. In April2005 ICG arranged and provided mezzanine finance of €27m to assist in thebuyout. ICG also invested €3m in the equity. LWB Refractories, a Belgian company, is the world's leading manufacturer ofdolomite-based refractories, principally for use in stainless steel and carbonsteel production. In April 2005 ICG took a participation of €7m in the highyield bond. Mach, a company based in Denmark, is the leading global clearing house ofroaming billing records for mobile network operators. In August 2005 ICG took aparticipation of €70m in the mezzanine facility arranged to finance thesecondary buyout. ICG made an equity investment of €10m in February 2006 toassist in financing an acquisition. Marken is a U.K. company that provides specialist global logistic services forclinical drug trials. In March 2006 ICG arranged and provided mezzaninefinancing to assist in the buyout. Medi-Partenaires is a leading French hospital group in specialised acute care.In May 2005 ICG arranged and provided mezzanine facilities of €57m to assist inthe buyout. Mennisez is a leading industrial bread producer based in France. In March 2006ICG arranged and provided mezzanine financing of €35m together with equityfinance of €25m to assist in the re-organisation of the share capital structureof the company. Meyn, a Netherlands company, is a manufacturer of poultry processing equipment.In March 2005 ICG arranged and provided a mezzanine loan of €14m to assist inthe secondary buyout. ICG made an additional €1m investment in March 2006 toassist with an acquisition. Molnlycke, a Swedish company, is a global surgical supplies and wound careproducts business. In August 2005 ICG took a participation of €18m in themezzanine finance provided to assist in the secondary buyout. Nocibe is a French retailer of perfumes and cosmetics. In March 2006 ICGarranged and provided mezzanine facilities of €44m to assist in the secondarybuyout. ICG also invested €10m in the equity. NW Vending, based in Italy, is the leading European manufacturer of food andbeverage vending machines. In November 2005 ICG took a participation of €40m inthe mezzanine finance arranged to assist in the buyout. ICG also invested €6m inthe equity. Petroplus, a Netherlands company, is a midstream oil company involved in therefining, storage and wholesale distribution of petroleum products. ICG took a€1m equity investment in the public to private. PHS, a U.K. company, provides washroom cleaning and maintenance services andoffice services. In December 2005 ICG took a participation of £35m in themezzanine finance used to assist in the public to private acquisition. Protection One, a French company, provides electronic surveillance services. InJuly 2005 ICG arranged and provided a mezzanine loan of €13m to assist in thesecondary buyout. ICG also invested €9m in the equity. Sia is a French company that designs, sources and distributes householdproducts. In July 2005 ICG arranged a mezzanine facility of €20m to assist inthe secondary buyout. ICG also invested €3m in the equity. Sogetrel, a French company, is a specialist in the design, installation andmaintenance of communication networks. In March 2006 ICG took a participation of€10m in the mezzanine finance provided to assist in the secondary buyout. Souriau is a French company which designs, manufactures and sells connectors tothe commercial aircraft market. In March 2006 ICG took a participation of €24min the mezzanine loan provided to assist in the secondary buyout. ICG alsoinvested €5m in the equity. Svenson is the leading "specialised haircare" group in Spain. In March 2006arranged and provided mezzanine facilities of €13m to assist in the buyout. ICGalso invested €3m in the equity. TDF Towers, an existing borrower, is a French company that operates broadcastingtowers. In March 2005 ICG made an additional investment of €5m in the equity ofthe company. Terreal is a French company that produces clay roofing tiles and bricks. InNovember 2005 ICG took a participation of €30m in the mezzanine finance providedto assist in the secondary buyout. ICG also invested €5m in the equity. Tunstall, a U.K. company, manufactures and maintains social alarm systems. InOctober 2005 ICG took a participation of £13m in the mezzanine facility arrangedto assist in the secondary buyout. TSL is a U.K. publisher in the education market. In February 2006 ICG took aparticipation of £16m in the mezzanine finance provided to assist in the buyout. In the same period ICG arranged or participated in the refinancing of 11companies, all existing borrowers AA refinanced in March 2006, in which ICG reduced its exposure by £5m. Allflex refinanced in June 2005 and ICG increased its exposure by €12m. Codere refinanced in June 2005. ICG had its mezzanine loan fully repaid butinvested €15m in a high yield bond. Edscha refinanced in May 2005. ICG invested €26m in the new mezzanine loan. Elis refinanced in July 2005. ICG reduced its exposure by €5m. Gala refinanced a number of times during the year. ICG invested an additionalnet £20m. Gerflor refinanced in July 2005. ICG retained its mezzanine exposure and reducedits equity exposure by €6m. Leisure Link was refinanced in February 2005. ICG retained its existingcommitment. Medica was refinanced in July 2005. ICG retained its existing commitment. Springer refinanced in June 2005 and ICG increased its exposure by €10m. SR Technics refinanced in September 2005. ICG increased its exposure by US$ 20m. This information is provided by RNS The company news service from the London Stock Exchange