GP Investments Buys Stake In APEN Ltd.
Headquartered in Bermuda, GP Investments Ltd. — a leading alternative investment firm in Latin America — on Tuesday [May 21] announced the investment of approximately $33 million to acquire approximately 26.7 percent of Swiss-based investment company APEN Ltd. as part of a strategy to increase and diversify its assets under management.
APEN Ltd. is listed on the SIX Swiss Exchange and invests in private equity funds and co-investments in Europe and the United States.
Currently the company´s portfolio of private equity fund investments represents 84 percent of total assets.
Going forward, APEN Ltd. will change the focus to co-investments and secondary private equity transactions in emerging markets, aiming to reach a more balanced portfolio between co-investments and private equity funds.
GP will own a subsidiary management company, which has been hired by APEN´s Board of Directors to manage current portfolio and new investments to be made by APEN.
APEN’s current management team will be transferred to the new management company owned by GP and will be led by APEN´s CEO David Salim. APEN will focus its strategy on co-investments and secondary private equity opportunities in emerging markets.
“We are one of the first listed private equity investment companies worldwide focusing its investment strategy on emerging markets. Considering the economic growth and need for capital in these regions we see a big potential for attractive private equity investment opportunities”, explained APEN CEO David Salim.
This will allow GP Investments to enter into new segments of alternative investment markets establishing a global platform with co-investments, fund of funds and secondary private equity transactions.
Additionally, it provides further products and business diversification, complementing GP Investments´ activities in private equity, real estate, infrastructure, and Brazilian asset management through BRZ Investimentos.
“We are very enthusiastic about the opportunity to have a presence in a new segment and develop a global platform, further diversifying our activities in market segments with outstanding growth perspectives. This initiative also adds $421 million to the total assets managed by GP, in the form of permanent capital”, said GP Investments’ Co-CEO Fersen Lambranho.
Together with GP Investments, Newbury Partners and Fortress Investment Group will provide approximately $247 million from an asset acquisition, new equity and debt to APEN Ltd.
This resource will be used to pay back APEN´s existing obligations as well as to capitalise the company for new investments.
APEN´s post-transaction balance sheet will have total assets of $421 million and total debt and obligations of $189 million [representing a reduction of $109 million in debt].
Debt and obligations to equity ratio will drop from 1.8x to 0.8x. This transaction is accretive to APEN’s adjusted net asset value [NAV] increasing it from $167 million to $233 million.
GP Investments will be the largest shareholder with an ownership of 26.7 percent. The shares were acquired for a price of 21.8 Swiss france per share, which represents a 48 percent discount to post-transaction NAV.
Both Newbury Partners [a US-based private equity secondary-focused fund] and Fortress Investment Group (US-based alternative investments company) will hold an ownership of 13.4% each. The remaining 46.5 per cent of APEN will be held by APEN’s existing shareholders with the exception of AIG who will no longer be a shareholder in the company.
GP Investments, a leading alternative asset investment firm in Latin America, has been actively investing in the region since 1993. GP Investments has raised over USD 5 billion with a track record of 52 completed deals across 15 different sectors.
In May 2006 GP Investments concluded its initial public offering, thus becoming the first listed private equity company in Latin America
