Sharp widening of JPEL’s discount – JPEL Private Equity has announced results for the year ended 30 June 2020. COVID and other factors pushed the NAV down by 5.3% to $1.61, but the share price fell from $1.43 to $1.08, meaning that the discount widened from 15.9% to 32.9% and it is now 35.2%.
JPEL is selling off its portfolio and returning cash to shareholders. $105m was handed back during the year. This was funded in part by distributions from the portfolio of $99.1m. This was primarily due to the sale of JPEL’s 2nd largest portfolio company, a Tax Advisory Services company. The partial realisation resulted in an investment return of approximately 4.39x and an IRR of approximately 33% for JPEL. As part of the transaction, JPEL received proceeds of approximately $37.5 million and continues to hold approximately 20% of its position in the company.
The statement says that the NAV was negatively affected by mark to market adjustments relating to the values of MBI, Corsicana, Polo Holdings and Prosper Marketplace.
As at 30 June 2020, the company did not have any leverage or any outstanding ZDPs and had $15.2m in cash and cash equivalents. The current portfolio is mature, with a weighted average age of 7.3 years at 30 June 2020. The board and the manager anticipate that the majority of the JPEL portfolio will be wound down within the next three years.
JPEL : Sharp widening of JPEL’s discount