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Record results from Standard Life Private Equity


Record results from Standard Life Private Equity – Standard Life Private Equity has announced results for the year ended 30 September 2021. The figures are good – an NAV return of 37.9% (the best in the trust’s 20-year history) and a whopping 60.6% share price return as the discount narrowed significantly. Both of these figures were well ahead of the 27.9% return posted by the UK market over that period. The total dividend for the year was 13.6p, an increase of 3.0% on FY20.

The returns were driven by a record year for realisations, the highest annual total in the company’s history – The portfolio saw distributions from investments of £198.7m (2020: £140.7m).

The NAV dipped slightly (-2.7%) in the three-month period ended 31 December, mostly reflecting a weak euro as expectations rose of UK interest rate rises.

Notable exits include Colisee (Nordic-based care services), Questel (provider of IP information and management software) and Itiviti (electronic trading software). Prominent IPOs in the portfolio include Moonpig (UK-based online gifting business), Dr Martens (leading consumer footwear brand), Nordnet (Nordic savings and investments platform) and Inpost (self-service lockers for ecommerce consumers).

The company has also sold its interest in IK Small Cap III for €0.2m. This fund interest had outstanding commitments of €24.8m prior to the date of sale. The intention is to re-commit the capital released from this sale to another investment opportunity with IK.

Against that, £307.1m (2020: £140.0m) was committed to eight primary fund commitments, two secondary transactions and 10 co-investments, bringing the total to 13. Most new investments have a technology or healthcare focus. Co-investments are increasing as a proportion of the portfolio and accounted for about 11% of the portfolio at year end (2020: 5%).

Notable new underlying companies included:

  • Syntegon (CVC VII) – Machinery and equipment used in the packaging sector;
  • Zahneins (PAI Europe VII) – The largest dental chain in Germany with over 30 sites;
  • SpaMedica (Nordic Capital IX) – Leading provider of cataract surgery in the UK;
  • CSM Ingredients (Investindustrial VII) – B2B manufacturer of bakery ingredients (pastry and bakery);
  • Questel (IK Fund IX) – Global provider of intellectual property (“IP”) solutions;
  • Quantum (PAI Europe VII) – UK-based chilled food supplier.

In addition, a new primary commitment of $20.0 million was made to WindRose Health Investors VI in December. WindRose Health Investors are a private equity firm based in the United States, who have a focus on the healthcare sector.

The company had cash and cash equivalents of £17.6m at 31 December 2021 plus £183.2m undrawn on its £200m syndicated revolving credit facility. That compares to outstanding commitments to fund investments of £518m. [Private equity funds tend to always run with overcommitments to avoid cash (which doesn’t return much, especially while interest rates are so low) from acting as a drag on returns. Not all commitments get called down, it is possible to reduce commitments by selling funds, and the company can also be reasonably confident that cash flows from the portfolio will be sufficient to meet most commitments when they fall due. In practice, it is rare for Standard Life Private Equity to use its £200m borrowing facility.]

Name change

The board is proposing that the company changes its name to abrdn Private Equity Opportunities Trust Plc (the Standard Life brand has been sold to Phoenix Life). The proposed name change is subject to a shareholder vote, which will take place at the AGM in March 2022.

SLPE : Record results from Standard Life Private Equity

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