Jz Capital Regulatory News (JZCP)

JZ Capital Partners Ltd - Update: Secondary Sale and

PR Newswire

London, April 7

JZ CAPITAL PARTNERS LIMITED (the "Company" or "JZCP")(a closed-ended investment company incorporated with limited liability under the laws of Guernsey with registered number 48761)LEI 549300TZCK08Q16HHU44

Update in relation to Secondary Sale and

Monthly Net Asset Value

7 April 2022

JZ Capital Partners Limited, the London listed fund that has investments in US and European microcap companies and US real estate, is today pleased to provide an update in relation to its interest in the secondary fund, JZHL Secondary Fund LP (the "Secondary Fund") to which JZCP sold its interests in certain US microcap portfolio companies (the "Secondary Sale"). The Secondary Sale was announced on 19 October 2020, with further details of the sale being included in a circular sent to shareholders of the Company dated 29 October 2020.

The Secondary Fund has sold its interest in Flow Control Holdings LLC ("Flow Control") for consideration of approximately US$77.7 million. This transaction confers no immediate cash benefit to JZCP because, as described below, the other investors in the Secondary Fund (the "Secondary Investors") have an entitlement to a priority return before any distribution may be made to JZCP. However, as a result of the distribution to the Secondary Investors from the sale of Flow Control the amount of the outstanding priority return has been reduced to approximately US$35.5 million. Excluding Flow Control, the remaining investments in the Secondary Fund are, subject to audit, held at approximately US$256.5 million as at 28 February 2022. JZCP’s interest in the Secondary Fund based on pro forma financials as at 28 February 2022 is valued at approximately US$117.3 million.

As detailed in the aforementioned announcement and circular, JZCP received as consideration for the Secondary Sale, and in addition to the already received approximately US$90 million in cash, a special limited partner interest in the Secondary Fund entitling JZCP to certain distributions and other rights and obligations from the Secondary Fund (the "Special LP Interest"). Any distributions to be received by JZCP as a result of its Special LP Interest are subject to an agreed distribution waterfall as detailed in the aforementioned announcement and circular which provides that, once the Secondary Investors have received their initial required distributions determined by reference to their respective contributions to the Secondary Fund and amounting to approximately US$132.6 million, in aggregate, JZCP will be entitled to receive as distributions from the Secondary Fund: (i) 95 per cent. of all distributions until it has received distributions equal to US$67.6 million; and (ii) thereafter, 37.5 per cent. of all distributions.

The sale of Flow Control will result in the Secondary Investors receiving a distribution from the Secondary Fund of approximately US$77.7 million which, together with other distributions so far made and received, will amount to distributions totalling approximately US$97.1 million for the benefit of the Secondary Investors. The Secondary Investors are therefore still entitled to receive further distributions from the Secondary Fund totalling approximately US$35.5 million before JZCP becomes entitled to any distributions as a result of its Special LP Interest and in accordance with the distribution waterfall as described above.

The Company will make further announcements concerning the distributions of the Secondary Fund (and in particular concerning any distributions as a result of its Special LP Interest) as and when appropriate and once further information becomes available to it.

Update in relation to Monthly Net Asset Value

On 23 March 2022, the Company announced that its unaudited Net Asset Value ("NAV") per Ordinary Share of the Company as at the close of business on 28 February 2022 was US$ 4.16.

The sale of Flow Control has resulted in an uplift to the Company's unaudited NAV per Ordinary Share of the Company as at the close of business on 28 February 2022 of 24 cents per share, as follows:

The Company’s annual results are currently being audited and the above NAV is therefore subject to change.

______________________________________________________________________________________

For further information: