Listed UK private equity house 3i has posted a mixed bag of results for the six months to September 30, recording a number of strong realisations but still showing a downturn in the firm’s overall performance, albeit less marked than many other public companies.
The firm reported a negative total return of 14.4 per cent on opening shareholder funds. The fall was just under half that recorded by the FTSE 100 and FTSE all-share indices, which fell by 28 per cent in the period, and a slight improvement on the 19 per cent reduction reported for 2001. The firm announced an unchanged interim dividend of 4.9 pence per share.
Realisations for the period totalled £619m, generating a net realised profit of £118m. The firm’s biggest success was its exit from low-cost flight operator Go Airlines, which was sold to EasyJet for £374m within a year of its acquisition from British Airways for £110m. Other exits included the sale of interests in healthcare businesses Caretech and Castlebeck Care, both based in the UK, and the sale of fast food chain Wimpy.
The firm has been an active investor through the downturn, making investments totalling £393m in the six-month period. However, despite a number of large investments, including the £100m acquisition of Paper-Pak in the US and a £57m deal to acquire Marconi’s Applied Technologies Division in July, investment levels were down around 30 per cent on the same period in 2001.
3i is planning to hold a first close of its latest buyout fund before the end of the current financial year. The firm is targeting a £3bn final close for the fund, which will invest in European mid-market management buyouts. It hopes to raise up to E1.5bn of the fund from third-party investors.