3i earned a multiple of 3.7x across the last year on the back of 12 portfolio company sales and two re-financings, led by the refinancing of discount retailer Action, the firm’s annual results show.
The refinancing of the Benelux retailer was the standout event, delivering a 20.8x multiple and proceeds of £187 million.
Of the 12 full exits, the sale of baby products company Mayborn to Chinese group Shanghai Jahwa was the strongest, delivering a multiple of 3.5x.
The partial realisation of ferry operator Scandlines brought in £16 million and a multiple of 4.6x.
The sales saw the London-listed investor bring in a total of £982m, the best result for the firm since Simon Borrows became chief executive five years ago.
“Financial year 2017 was another important year for 3i. Our private equity and infrastructure businesses performed well and we simplified the group by selling our debt management platform. Our efforts over the last few years in reshaping the portfolio mean we are now able to focus on active asset management and origination. We have made a good start to financial year 2018 with around €500m of new investments signed and strong value growth potential in our current portfolio,” Borrows said.
Last year also saw the firm invest the most across a year since 2013, at £478 million, which included £132 million spent on furniture company BoConcept.
The firm said last year’s Brexit vote and Trump presidential win had “created volatile conditions,” and that “the market environment remains intensely competitive” given the availability of debt and levels of dry powder.
The results also show the firm has continued to downsize its portfolio, with the investor now holding 37 portfolio companies and 3 quoted holdings compared with 47 portfolio companies and 5 quoted holdings at the start of the 2017 financial year. In recent years the firm has embarked on an effort to narrow its sector and geographical focus. In 2010 it held 113 portfolio companies.
Looking ahead the firm says it will remain “opportunistic but disciplined” and foresees another year of “significant uncertainty.”