Princess Private Equity Holding
Introducing a well-defined buyback policy
29 April 2024
Princess Private Equity Holding’s (PEY’s) 12-month NAV total return (TR) to end-February 2024 was a modest 0.6% amid low exit activity across private equity (PE) markets. That said, if the pick-up in global M&A volumes witnessed earlier in 2024 continues, it should support PEY’s exit activity. This in turn would translate into improved returns if PEY delivers sizeable uplifts to previous carrying values upon exits, as it has done historically. In this context, we note that PEY has a good pipeline of mature investments that are potentially ripe for sale. PEY’s shares now trade at a 24% discount to NAV versus a 10-year average of 18%. MORE »
Solid Q121, attractive dividend and well-filled pipeline
24 June 2021
Princess Private Equity (PEY) reported a strong c 10% NAV TR from January to end-April 2021 (10% in FY20), largely driven by its in-closing exit from GlobalLogic announced in March 2021, generating a 45% uplift from its end-February 2021 carrying value. This represents a very solid 5.3x multiple on invested capital, despite the short holding period since 2018. PEY’s attractive dividend yield of c 5% is ahead of most of its peers and the manager is confident in its ability to maintain the current dividend policy to distribute c 5% of the opening NAV. PEY has a comfortable liquidity position with a coverage ratio at c 49% at end-April 2021, further supported by proceeds from major exits agreed in 2021 but not yet closed. MORE »
Resilient portfolio continues to expand
10 December 2020
Princess Private Equity Holding (PEY) recorded a solid 10.0% NAV total return over the 12-month period ending on 30 October 2020, despite a 14.1% decline in March reflecting the initial impact of COVID-19. Its well-diversified portfolio, focused on relatively resilient sectors, required minor additional financing to mitigate liquidity risks. The rate of new investment picked up in Q320 and reached €63.5m ytd, close to the FY19 total of €69.3m. As there is currently no material portfolio funding requirement according to the investment manager, PEY reinstated its dividend policy and decided to pay a second interim dividend on par with the H219 distribution. MORE »
Actively driving portfolio resilience
11 March 2020
Princess Private Equity (PEY) delivered a robust NAV TR increase in FY19 of 21.1% on the back of good earnings momentum and progress with the ‘buy and build’ strategy for key portfolio holdings. The company remains fully invested, with most of its €50m credit facility drawn at end-January 2020. It plans to repay this on receipt of proceeds from the Action exit, which was agreed in FY19. Looking ahead, PEY remains committed to its strategy of creating resilience in portfolio companies aimed at mitigating downside risks from a potential economic downturn. MORE »
Steady realisations support dividend payout
29 November 2019
Following high investment activity in 2018, which allowed Princess Private Equity (PEY) to become fully invested, its balance of new investments vs realisations has been broadly neutral so far in 2019. PEY received c €68m in distributions, mainly from the winding down of legacy funds and gradual disposal of Ceridian HCM shares. The proceeds were used to finance a healthy dividend (current yield of 5.7%) and €52m in new deals, mainly in fairly defensive sectors such as healthcare and education. We also note that PEY’s investment manager (Partners Group) has agreed to fully exit Action (PEY’s second largest holding). NAV total return to end-October was a solid 14.0%, driven by the revaluation of holdings on the back of robust organic growth (eg Action) and continued execution of the ‘buy-and-build’ strategy (eg Permotio). MORE »
Strong flow of attractive deals in FY18
4 March 2019
Princess Private Equity Holding (PEY) recorded a particularly high level of investment activity in FY18 (to 31 December), following on from a record year of realisations in FY17. The fund focuses on profitable companies with: a consistent track record of EBITDA growth (an average of 11.5% for 2018 across the whole portfolio); meaningful growth potential, supported by strong competitive positions in growing end markets; and clear scope for manager Partners Group’s industry value creation (IVC) team to add value through operational and governance improvements. PEY’s NAV total return for FY18 was 6.8%, a c 10pp outperformance of global listed equity markets, and although the share price total return for the year was negative as a result of the sharp sell-off in public markets in Q418, it has rebounded by more than 10% year to date (to 1 March). PEY has a high distribution policy and currently offers a dividend yield of 6.0%. MORE »
Diversified global portfolio with high dividends
6 April 2018
Princess Private Equity Holding (PEY) offers investors access to the private equity and debt expertise of global manager Partners Group ($74bn AUM), as well as selected co-investments with third-party managers. It has followed a direct investment strategy since 2011, when it refocused away from third-party funds of funds, and has seen solid NAV and share price performance over most periods of five years and shorter. Partners Group’s differentiated global approach includes a highly selective process of deal sourcing (c 99% of potential investments are declined each year), and an in-house value creation team who can plan and implement initiatives to help investee companies achieve superior growth. PEY has a high dividend policy, targeting a payout of 5-8% of the opening NAV each year. MORE »
Diversified global portfolio with high dividends
6 April 2018
Princess Private Equity Holding (PEY) offers investors access to the private equity and debt expertise of global manager Partners Group ($74bn AUM), as well as selected co-investments with third-party managers. It has followed a direct investment strategy since 2011, when it refocused away from third-party funds of funds, and has seen solid NAV and share price performance over most periods of five years and shorter. Partners Group’s differentiated global approach includes a highly selective process of deal sourcing (c 99% of potential investments are declined each year), and an in-house value creation team who can plan and implement initiatives to help investee companies achieve superior growth. PEY has a high dividend policy, targeting a payout of 5-8% of the opening NAV each year. MORE »
