TFG writes down portfolio

Ahead of what are likely to be weak annual results in November, TFG Venture has reduced the valuation of its portfolio by E32m.

German-listed venture capital firm TFG Venture Capital has announced a further writedown on its venture capital portfolio. The E31.8m writedown takes the total reduction for the last nine months to E42.5m.


The net asset value (NAV) of the firm’s portfolio fell from E6.34 to E3.79 per share, a fall of 40 per cent in the three months to 30 September. “We are facing a very depressed market at the moment in which most firms are concentrating on their portfolios rather than making further investments,” said TFG spokesperson Andrea Lengeling.


More encouraging was the prospect of greater cost efficiencies at TFG, including news that the firm would abandon its listing on the SMAX stock exchange before the end of 2002. In the last quarter, the firm’s cash levels fell by a modest E3.1m to E23.7m.


Delisting will allow the company to save on the costs of the index listing and of meeting  extensive reporting requirements under IAS. In 2003, the company will return to complying with the reporting and publishing requirements of the German Commercial Code (HGB).


Lengeling said that the firm was likely to make another investment before the end of the year. However, “the fact that valuations and prices are low does not mean prices are good,” she added. “We think that most sectors will continue to decline in the coming months, making it difficult to gauge when valuations have reached their lowest point.”


According to its website, TFG is currently invested in some 60 companies in the IT, industry and life science sectors.