13th May 2009 12:00
Press release Candover Investments plc - AGM statement highlights
Candover Investments plc ("Candover" or "the Company") is hosting its Annual General Meeting at midday today. At the meeting, Gerry Grimstone, Chairman, will highlight the following:
* The Board of Candover continues with its review of all strategic options with the aim of achieving financial stability for Candover. * Candover's current challenges are managing the impact of the sharp fall in the value of its assets at the end of 2008 and ensuring the Company has sufficient cash and liquidity to fund its ongoing operations including its commitments to the Funds raised by Candover Partners * NAV declined by more than 50% in 2008 to £224 million or 1026p per share compared to £451 million or 2065p per share in 2007. Candover's investments are valued against quoted company multiples and the significant falls in these quoted multiples during 2008 resulted in downward portfolio valuations. * Candover has relied on the realisation of investments to fund its future commitments. In 2008, realisations were £47 million, down from £162 million in 2007 as a global lack of liquidity affected the ability of buyers to acquire companies. The lack of realisations adversely impacted Candover's cash resources. * There is an outstanding commitment of £90 million to the Candover 2005 Fund to fund follow-on investments or to strengthen the capital positions of the portfolio companies. Ensuring that Candover remains able to fund this commitment, whilst ensuring compliance with bond covenants, is an important priority. * The 2008 Fund has been suspended for up to six months from 6th April, 2009 and its future depends on, amongst other things, the outcome of discussions between Candover Partners and the Fund's Limited Partners. * As part of the strategic review, several expressions of interest covering a number of options have been received. These options range from proposals to acquire the Company for either cash or a mixture of cash and shares through to proposals for third parties to acquire a minority stake in the Company. The value to shareholders from any of these options is subject to due diligence,remains highly uncertain and no reliance should be placed on any particular outcome.
Gerry Grimstone, Chairman of Candover Investments said :
"We are facing a particularly complex situation because of Candover Investments' responsibilities to its shareholders and bondholders, and Candover Partners' responsibilities towards the investors in its Funds. Your Board is clearly focused on ensuring that we work through these complexities to find a solution that is in the best interests of all the various stakeholders. Preserving the value in our existing funds, including Candover's share of the carried interest in those funds, is our top priority. We continue to believe that there is considerable value within many of our portfolio companies and that this will be realised significantly above the current valuations once global economies recover"
Commenting on the portfolio, Marek Gumienny, Managing Director of Candover Partners Limited said:
"Over 60% per cent of our portfolio of 18 companies are trading above budget in Q1 2009 and ahead of prior year, after adjusting for seasonal factors such as Easter as well as currency fluctuations. Of the balance, three businesses have covenant issues which we are working closely with management and lenders to solve in a consensual fashion, and we did not ascribe any value to these investments in our year end accounts. All of our focus today is on preserving value in our portfolio companies"
Ends
The full text of the AGM statement will be available at www.candoverinvestments.com/investor-info/agm later today.
For further information, please contact: Tulchan +44 20 7353 4200
Susanna Voyle/Peter Hewer
vendorRelated Shares:
CDI.L