Electra Private Equity has agreed to sell its shares in Nuaire, a London-listed ventilation systems company, to Polypipe Group, the investment trust said in a statement.
On completion, expected this month, Electra will receive proceeds of £72 million ($112 million; €103 million) for the sale of its 51 percent stake. The total value of the sale is £145 million.
The sale is Electra’s first full exit in more than a year, it is understood.
The transaction will generate a return of 3.8x and an IRR of 18 percent on Electra’s original investment of £23 million made through a management buyout in 2007, according to the statement.
When asked by Private Equity International about the timing of the sale and the multiple, Electra partner Charles Elkington said: “We have been invested for eight years and thought it was the right time to realise our investment – 3.8x and 18% over eight years is a respectable return. In terms of timing, we did not originally envisage holding the investment for eight years – but our flexible mandate has allowed us choose our timing and deliver a return pretty close to what we originally estimated.”
Over the course of Electra’s investment in Nuaire the company’s revenues have increased by 80 percent and profits by 120 percent, Elkington said in the statement.
When asked about the market for realisations, Elkington told PEI that “it remains pretty buoyant and we have tried to go with that positive momentum.”
Following the sale of Nuaire, Electra has 30 direct investments left in its portfolio, it is understood.
The investment trust made £26 million of realisations in the quarter ending 30 June, of which £12 million was returned from its direct unlisted investments that included £4 million from AXIO Data Group and £4 million from UK caravan operator Park Resorts, which it bought for £27 million in the same quarter. Its secondaries portfolio returned £9 million, the bulk of which was from its EP1 Secondary Portfolio that returned £8 million.
In May, Electra agreed to sell its interest in French laboratory group Labco for which it will receive total proceeds of €22 million upon completion the transaction, its earnings report said.
Labco is being acquired by Cinven and has a total enterprise value of €1.2 billion, as reported by Private Equity International.
Electra is always looking to acquire, Elkington said. “You have to be quite fleet of foot and try to find appropriate value. We are in a buoyant market and you need to be smart about where you invest.”
For the quarter, the firm reported it had made £30 million of investments, including the Park Resorts transaction and £3 million invested in funds.
Electra had £101 million of liquid resources at the end of the quarter and is understood to have an undrawn bank facility of £275 million as of 31 March.
Electra Private Equity is listed on the London Stock Exchange with a market capitalisation of £1.2 billion. It had £1.6 billion of funds under management at the end of March.
On 24 July Electra distributed its first dividend of 38p per ordinary share in line with its distribution policy announced in February and a 1 percent net asset value interim dividend declared in May.
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