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SVG Capital commits €100m to UK buyout group Cinven

15 Feb 2013

FTSE 250-listed fund investor SVG Capital has committed €100m to European buyout group Cinven.

The fund had previously operated as a listed feeder fund for UK private equity firm Permira, but last year said it was seeking to diversify its portfolio away from the firm and return cash to its investors

In its most recent results announcement it said it aims to return £300m to investors over the next three years. “We expect to announce other new investments during 2013,” it said.

CEO Lynn Fordham said,  “I am pleased to report another year of significant progress at SVG Capital.

“The work by Permira and the underlying management teams has translated into a material increase in the value of our assets and driven distributions from the portfolio.

“When combined with the disciplined capital allocation and focus on repositioning the portfolio during the year, the company can now start laying the foundations of its future returns beyond the current portfolio with its first new commitment, which is to the Fifth Cinven fund.”

SVG Capital also reported NAV per share increase of 16 per cent to 391 pence. It has plans for a £65m tender in April 2013, completing its December 2011 £170m capital return commitment.

In October 2012, SVG Capital sold a £90m stake in Permira’s 2004-vintage fund.

SVG’s stake in Permira Europe III, which represented eight per cent of the firm’s investment portfolio, was sold at a 13.3 per cent discount to Permira’s September 2012 valuation of the assets. The firm said it would continue to have a material exposure to Permira Europe III indirectly through Permira Feeder Vehicles.

At the time, SVG added that it is attempting to focus the portfolio “… towards less mature assets with diversified global revenue streams and stronger growth prospects.”

It also survived a shareholder revolt led by Coller Capital, its largest investor, which owns a 20.4 per cent stake.

Just yesterday, SVG Advisors sold a 50 per cent in itself to Aberdeen Asset Management for £17.5m.

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