JPEL : JPMorgan Private Equity balance sheet improving
JPMorgan Private Equity’s results for the year ended 30 June 2014 show its net asset value rising by 2.7% or 3 cents to $1.14. The shares moved up 5.5%, narrowing the discount a little but still leaving it close to 30%. The Board and managers say they are unhappy with this situation and “may seek to opportunistically repurchase US$ equity shares in the open market”.
During the period institutional investors bought a block of JPEL shares at 80 cents. The company announced that, post the maturity of the 2015 zeros, shareholders would be offered the option to switch into a realisation share class.
JPMorgan Private Equity also suspended all distributions to shareholders and instead said it would invest $150m in new investments before December 2015. Since announcing this policy, they have made four purchases of secondary direct investments at a cost of $50m – one in Asia, one in the US and two in Europe. They also made two follow on investments in existing portfolio companies and met cash calls of $8m. These were funded from the $118m of cash generated by the portfolio.
JPMorgan Private equity has cut its debt from $243m to $152m – giving them overall leverage of 28%. Cash levels have been boosted since the year end by the sale of the Parallel portfolio. They could also sell their investment in Deutsche Annington – this was value at $53m in June. their lock-in on this listed investment expired on 20 August.