3i set to return to FTSE 100

The London-listed group, which was dropped from the index in September 2011, has been part of the FTSE 100 twice before.

3i Group, a private equity group listed on the London Stock Exchange, is set to return to the FTSE 100 index.

Based on current positions, 3i will be promoted to the FTSE 100, the London Stock Exchange Group said in a statement. The final decision and approval will be taken by the FTSE EMEA Committee during its review on Wednesday, using close of play data from 3 June.

The FTSE 100 comprises of the 100 companies on the London Stock Exchange with the highest market capitalisation. Businesses are eligible for automatic promotion to the FTSE 100 if they are ranked higher than the 90th company in the index based on market cap. The reviews take place on a quarterly basis, according to a London Stock Exchange spokesperson.

3i has not been part of the FTSE 100 since September 2011, when it was dropped from the index after joining the FTSE 100 in June 2009.

3i did not immediately respond to a request for comment at press time.

News of a return comes after 3i announced it had exceeded its cost reduction target by £10 million on its last earnings call. 3i reduced its gross debt to £857 million, from £917 million last April, while gross interest costs were cut to £54 million, ahead of its £60 million target.

The firm said improved performance in the portfolio led to a rise in valuations of Eurofund V and 3i’s Growth Capital Fund, which have now recovered to 1.13x and 1.32x respectively of invested capital at 31 March 2014, compared to 0.93x and 0.95x at 31 March 2013 respectively.

A number of private equity-backed businesses are also set to enter the FTSE 250 Index, the London Stock Exchange Group said. FTSE Small Cap companies or new entrants that are at the 325th position or above include online take away business Just Eat. Just Eat is majority-owned by UK buyout firm Vitruvian Partners and VC group Index Ventures. KKR-backed, Pets At Home Group and Warburg Pincus-backed, Poundland Group are also set to join the index.