Pleasure and Pain

A GOOD MONTH FOR…

European buyout houses Permira and Apax Partners, which offloaded their combined 90 percent stake in high street fashion chain New Look to South Africa-based investment company Brait for around £780 million (€1.08 billion; $1.23 billion), bagging the firms a return on investment of 4.3x and 4.4x respectively. The pair, which had roughly equal stakes in the company, owned New Look for 11 years, during which time they almost doubled sales and EBITDA, expanded internationally and developed an e-commerce platform.

UK-based pan-European firm Charterhouse Capital Partners, which amassed €1 billion for its Charterhouse Capital Partners X, which is currently in market targeting €3 billion. Despite a difficult year featuring an ongoing court case brought by a former director, Charterhouse has raised the capital in just four months, helped by some impressive exits. The initial four exits from predecessor vehicle Fund IX, a €4 billion 2008-vintage, have delivered an average realised return of 3.3x. Charterhouse netted a 2.6x return and a 21 percent IRR on Deb Group, a 5.2x return and 47 percent IRR on Card Factory, a 3.4x return and 40 percent IRR on Wood Mackenzie and a 2.1x return and a 30 percent IRR on Bureau Van Dijk.

Africa, which is proving a hit with investors looking for exposure to emerging markets. Half of the limited partners surveyed by the African Private Equity and Venture Capital Association for a study indicated they plan to increase their private equity investment in Africa in the next three years, and more than a quarter of those LPs are looking to commit to funds in the continent for the first time. Eighty-five percent of LPs surveyed expect returns in African private equity to exceed 2x in the next five years, with 14 percent expecting returns in excess of 3x.

A BAD MONTH FOR…

Boston-headquartered Summit Partners, which lost Michael Anderson to California’s Mainsail Partners. Anderson, who worked as a principal at Summit, comes into Mainsail as the fourth investment partner and is set to focus on investments in the healthcare, software and technology industries. Anderson is currently on the board of directors of Integrated DNA Technologies, and has previously served on the boards of a handful of technology companies. Mainsail is currently investing from its third buyout fund which closed on $216 million in 2012, as well as a $4.3 million co-investment vehicle which closed in 2013.

Industry heavyweights CVC Capital Partners and KKR, which had to hand over Dutch waste management business Van Gansewinkel Group to creditors as part of a debt restructuring agreement. Under the terms of the restructuring the company’s creditors were set to write off 60 percent of the debt, reducing it from around €809 million to €320 million. In 2014 Van Gansewinkel’s turnover dropped to €962 million, from just over €1 billion in 2013, and EBITDAE dropped from €124 million in 2013 to €99 million, mainly as the result of “fierce price pressure on both sides of our value chain”, Van Gansewinkel said. Overall the company posted a loss of €549 million last year, mainly due to a €488 million goodwill write-off dating back to its acquisition by CVC and KKR in 2007.

Polish private equity firm Abris Capital Partners, which was forced to sell Polish retail and SME bank FM Bank. FM Bank was created in 2013 through the merger of two Abris-owned banks. Last year Poland’s financial watchdog KNF ruled that Abris failed to meet its commitments as an investor by failing to consult with the regulator on the choice of the chief executive for the new bank, as it is required to do. KNF stripped the fund of its voting rights in the bank and ordered it to sell the business by 30 April 2015. UK-based AnaCap Financial Partners agreed to acquire the bank for an undisclosed sum.