London-listed Apax Global Alpha (AGA), which invests in Apax Partners funds, realised 10 portfolio company investments, either fully or partially, made through its underlying funds in 2015, up from the previous year’s total of six.
The realisations generated an average multiple of investment capital of 3.7x, according to the first full year results presentation since its €300 million initial public offering in June.
Its private equity portfolio, which accounts for 52 percent of its €915 million total portfolio, has returned €24.6 million to AGA since December 2014.
Portfolio companies divested included Orange Communications, kosher food manufacturer Tnuva, security software company Sophos and car classifieds company Autotrader. Distributions were mainly from Apax Europe VI, a €4.3 billion 2005-vintage vehicle, and Apax Europe VII, a €11.2 billion 2007-vintage fund, which are both in realisation mode.
Underlying funds made 13 investments in 2015, compared to four the previous year. These include 11 by Apax VIII, a €5.8 billion 2012-vintage vehicle that is almost fully invested and accounts for 80 percent of AGA’s private equity portfolio, and two by its Israel-focused mid-market fund AMI Opportunities that closed on $500 million last year.
AGA plans to commit $350 million to Apax Fund IX, the firm’s latest vehicle, split between euro and dollar tranches, the presentation said.
Apax IX launched in the new year and is targeting $7.5 billion, as reported by Private Equity International. AGA’s commitment will come from sources including capital returned from its underlying funds.
AGA was 98 percent invested by 31 December, split 52 percent into private equity investments and 48 percent into derived instruments comprised of debt and equity. It is understood to be focused now on actively managing those investments.
Total realisations in 2015 from its derived investments stood at €117 million, with €73 million from its debt investments and €44 million from its equity investments, with eight full exits. New investments made by this portfolio were down from 23 in 2014 to 16 in 2015.
Overall, the balance of investment lies in North America, accounting for 57 percent of the portfolio, Looking forward, Europe is thought to be increasingly investible.
At the end of the year, AGA’s adjusted net asset value (NAV) stood at €923.6 million, up €110.7 million from the previous year, on a market capitalisation of €789.6 million. At the end of 2015, adjusted NAV a share stood at €1.88 up from €1.66 the previous year.
The listed fund reported a total return of 13.6 percent for 2015, and 25.5 percent since the inception in 2008 of its legacy vehicle PCV Lux.
AGA is targeting an annualised total return of 12 to 15 percent, net of fees and expenses and a dividend yield of 5 percent of NAV, once fully invested, it said in a stock market filing announcing its first annual general meeting on 8 April. Its gross target return for private equity is 20-25 percent per annum.
Its share price has steadily declined since its listing in 15 June from 124.75p to 111.25p on 7 March. Following its results announcement, AGA’s shares were trading up on the London Stock Exchange by 4.47 percent to 116.23 by 1:34pm.