Last checked at 
26 Jul 2012 07:00
26th July 2012
Pantheon International Participations PLC (the "Company") Net Asset Value at 30th June 2012
The Board of Pantheon International Participations PLC ("PIP"), the quoted private equity fund-of-funds investment trust, today announces an unaudited net asset value ("NAV") per share of 1,193.5p at 30th June 2012, an increase of 4.7% for the quarter and 8.1% for the financial year.
Net assets were £845m at 30th June 2012. Underlying net portfolio gains of £31m in the quarter were driven by uplifts across all stages of the portfolio, with strong performance in the large/mega buyout and special situations stages. Performance was strong across all regions, particularly the US which benefitted from the rise in public markets. Although distributions rose from the previous quarter, they remained slightly lower than the levels seen in the first half of 2011, consistent with more subdued activity levels in the private equity market in 2012. Despite this, the portfolio generated net cash flows of £18m.
Gains of £5m from movements in exchange rates and income of £3m were offset by interest and expenses of £3m. For investment purposes the Company bought back in the market £4m (at market value) of shares during the quarter. These buybacks resulted in a total uplift to NAV per share of approximately 3.1p.
Valuation Policy
PIP's valuation policy for private equity funds is based on the latest accounts produced by the managers of the funds in which PIP has holdings. In the case of the valuation as at 30th June 2012, the majority of valuations (accounting for circa 94% by value) are dated 31st March 2012. Private equity funds may contain a proportion of quoted shares from time to time, for example where the underlying company investments have been taken public but the holdings have not yet been sold. The quoted market holdings at the date of the latest fund accounts are reviewed and compared with the value of those holdings at the period end. If there has been a material movement in the value of these holdings, the valuation is adjusted to reflect this.
New Commitments and Share Buybacks
During the quarter PIP made one new secondary commitment to a US-based buyout fund interest, amounting to £8m. This investment included undrawn commitments of £3m. In addition, the Company made a co-investment of £2m in a US-based oil and gas exploration and production company.
Since the end of the quarter, the Company has completed a co-investment of £2m in a company focused on the Chinese automobile sector.
For new investment commitments the Company will continue to emphasise investments in secondary transactions and will also occasionally participate in co-investments alongside leading private equity managers selected by Pantheon.
The Board will also continue to consider further share buybacks as a means of enhancing NAV per share as an alternative to new investments whilst its shares continue to trade at such historically high discounts. In the quarter, PIP bought back for cancellation a total of 545,000 ordinary shares at an average price of 754p per share and 30,000 redeemable shares at a price of 740p per share. These transactions were executed at an overall discount of approximately 34% to the 31st March 2012 NAV, and resulted in a total uplift to NAV per share of approximately 3.1p.
Since August 2011, the Company has deployed a total of £32m in implementing share buybacks for investment purposes, acquiring 6.2% of PIP's total shares outstanding prior to any share buybacks.
Realisation Activity
In the quarter, PIP received distributions from investments of £30m. Examples of distributions in the quarter include (see note 1):
* Brentwood Associates announced in June 2012 the sale of Array Marketing Group, a retail merchandising systems manufacturer, to TorQuest Partners ("TorQuest") in partnership with the company's management team. In addition to this, Brentwood Associates announced the sale of Filson Holdings, a premium outdoor apparel maker, to Bedrock Manufacturing. The distribution received by PIP in connection with both these sales was £3.8m. * In April 2012 CVC announced the sale of StarBev to Molson Coors Brewing Company for €2.65bn. StarBev operates nine breweries in Central and Eastern Europe and generated 2011 EBITDA of €241m. The distribution received by PIP relating to StarBev was £0.9m.
Cash proceeds are expected in the coming months from the realisations of portfolio companies Carbolite and Global Blue, whose values represented 1.2% and 0.5% respectively of PIP's portfolio at 31st December 2011.
Call Activity
PIP invested £12m through calls of commitments to private equity funds in the quarter. Examples of calls in the quarter include:
* Baring Vostok IV invested in European Medical Centre, and Avito. European Medical Centre is a multi-profile clinic in Moscow with 20 years of history. Avito is a website for online classified adverts in Russia. The call paid by PIP relating to European Medical Centre and Avito was £0.9m. * In May 2012 Eurofiber was acquired by Doughty Hanson Fund V. Founded in 2000 and headquartered in the Netherlands, Eurofiber owns and operates a fiber network spanning over 12,000km and connecting over 4,500 unique locations. Doughty Hanson acquired the firm from Reggeborgh, an investment vehicle of the Wessels family who retain a significant minority stake. The call paid by PIP relating to Eurofiber was £0.8m.
Sample Underlying Company-Level Data (see note 2)
The Manager, Pantheon, undertook a review of underlying company data in PIP's largest 50 buyout funds and direct investments. The sample weighted average revenue growth and EBITDA growth for the year to 31st December 2011 was 16% and 15% respectively. Additionally, the sample weighted average EV/EBITDA and Net Debt/EBITDA multiples as at 31st December 2011 were 9.4x and 3.6x respectively.
Undrawn Commitments
Undrawn commitments to investments stood at £191m at 30th June 2012, calculated using exchange rates at that date.
33% of PIP's undrawn commitments are in fund vintages 2005 or older. Most of the funds in these older vintages are outside their investment periods and, as such, should have slower call rates. It is likely that a portion of these older commitments will not be drawn.
Cash Balance and Bank Loan Facility
As at 30th June 2012, PIP had cash balances equivalent to a total of approximately £51m.
In addition, the Company's multi-currency revolving credit facility agreement ("the Bank Loan Facility"), comprising an US$82m facility and a €57m facility, was completely undrawn. The Bank Loan Facility expires in June 2015.
Based on exchange rates at 30th June 2012, PIP's total available liquid financing capacity, comprising its cash and bank facility, stood at £150m.
Foreign Exchange Exposure
At 30th June 2012, the value of the private equity investment assets stood at £ 800m. Of the private equity investment assets at PIP's holding level, 70% were represented by funds reporting values denominated in US dollars, 23% denominated in euros, 6% denominated in sterling and 1% denominated in other currencies. Of the 70% of investment assets denominated in US dollars, approximately 5% (expressed as a proportion of PIP's total portfolio) are invested in funds investing mainly in Europe and approximately 9% (expressed as a proportion of PIP's total portfolio) in funds investing mainly in Asia. In addition to the funds reporting values denominated in sterling, many of the euro-denominated funds have investments in the UK.
Intention to release monthly Net Asset Values
Commencing in August 2012 for the month ending 31st July 2012, the Company intends to release net asset values monthly to provide investors with the most up to date information as it becomes available. Timetable requirements under the Company's Articles of Association in relation to issues or redemptions of shares may, exceptionally, from time to time cause the Company to suspend a NAV announcement in a particular month. A monthly reporting regime will increase the frequency of closed dealing periods imposed by the Company during the preparation of its monthly NAV. However, the total period in which the Company operates in closed dealing periods is not expected to increase as a result of this change in reporting frequency.
Note 1 The distribution or call amounts above may include small amounts relating to other companies or items.
Note 2 The sample buyout figures were calculated from the companies, where information was available, within the largest 50 buyout funds and direct investments in PIP's portfolio at 30th June 2011. This sample provided coverage of approximately 50% of PIP's buyout funds and direct investment exposure. The revenue and EBITDA figures were based upon the year to 31st December 2011, or where not available, the closest annual period disclosed. The net debt and enterprise value figures were based upon 31st December 2011 underlying valuations, or the closest period end disclosed. The underlying company data was weighted by NAV to calculate an average. Individual company revenue and EBITDA growth figures were capped at +1000% and -1000% to avoid distortions from excessive outliers.
Ends NOTESPIP
Pantheon International Participations ("PIP") is a London quoted investment trust, managed by Pantheon, one of the longest-established international private equity fund-of-funds managers, investing in both primary funds and secondary transactions. With investments in private equity funds, covering late stage buyouts to early stage technology, PIP enables individuals as well as institutions to gain access to a substantial portfolio of unquoted companies in the USA, the UK, Continental Europe and Asia, within funds managed by experienced private equity managers. PIP may occasionally acquire direct holdings in unquoted companies, usually where a vendor is seeking to sell a combined portfolio of funds and direct holdings. PIP's investment policy also extends to investing directly in companies where there is a private equity manager well known to the Company investing on the same terms.
Pantheon
Pantheon has been active in private equity since 1982 and is now one of the world's leading private equity fund-of-funds managers, with £15.0bn under management (as at 31st March 2012). Pantheon has offices in London, San Francisco, New York and Hong Kong, and has made investments in over 1,000 funds globally.
For more information please visit PIP's website at www.pipplc.com or contact:
Andrew Lebus or Alexis Barling
Pantheon
020 7484 6200
Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of this announcement.
Pantheon International Telephone +44 (0) 20 Participations PLC 7484 6200 Norfolk House Facsimile +44 (0)20 7484 6201 31 St. James's Square E-mail: London SW1Y 4JR pip.ir@pantheon.com Internet: www.pipplc.com
Registered office: Beaufort House, 51 New North Road, Exeter, Devon EX4 4EP. Incorporated in England number: 2147984.
An investment company under section 833 of the Companies Act 2006. Managed by Pantheon Ventures (UK) LLP.
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