Hg Capital sells minority interest in JLA

HgCapital Trust has announced the sale of a minority interest in JLA to a group of institutional investors. JLA is a leading UK provider of business-critical asset maintenance services to SMEs. After the deal, finds managed by HgCapital will retain c. 62% of JLA’s equity. In addition to the sale of a minority equity interest, the business has also been re-financed. The Trust will realise cash proceeds of approximately £17.3m on completion of these two liquidity events, in addition to the £4.5m received in October 2014 from a previous refinancing. Originally acquired by HgCapital in March 2010, JLA is one of the UK’s leading providers of commercial laundry and catering equipment on a contracted basis. JLA operates across a diverse sector base offering customers a fully inclusive machine supply and service proposition under the name of Total Care. Furthermore, the company provides customers with supplementary products and services (e.g. service contracts, compliance and safety service solutions, equipment sales and consumables). The combined return represents an investment multiple of approximately 3.5x over JLA’s holding period to date. The total value of cash proceeds and the retained stake (£20.4m) compares to a carrying value of £27.4m in the NAV of Hg Capital Trust at 30 September 2015, which was based on the Directors’ valuation as at 30 June 2015. This represents an uplift of £10.3m or 27 pence per share. Based on the 30 September 2015 reported NAV (and after adjusting for the impact of the above transactions and an increase in the carried interest provision), the NAV of the Trust is expected to increase to £486.8m or 1,304.1 pence per share.  The Trust’s liquid resources available for future deployment are estimated to be £48.1m (10% of the adjusted NAV), excluding a £40m standby facility. HGT : Hg Capital sells minority interest in JLA