Neuberger Private Equity Partners Limited USD · LSE:NBPE
Neuberger Private Equity Partners Limited USD — NB Private Equity Partners — Investor Presentation (November 2014)
38 slides from Neuberger Private Equity Partners Limited USD's investor presentation, November 2014
Slide 1: NB Private Equity Partners
NB Private Equity Partners November 2014 Financial Information as of 31 October 2014 unless otherwise indicated
Slide 2: NB Private Equity Partners (“NBPE”) Overview
NB Private Equity Partners (“NBPE”) Overview NBPE is a closed end investment company providing investors with diversified exposure to the private equity asset class Providing investors the opportunity for… … both capital appreciation and current income… …through investments in private equity-backed
Slide 3: Compelling Investment Opportunity
Compelling Investment Opportunity Structure designed to provide attractive returns, capital efficiency and current income • NAV per Share Cumulative Total Return1: • Strong performance over the short, medium and long-term • One Year: 15.6% CAPITAL APPRECIATION • Three Year: 36.7% • Five Year: 67.1%
Slide 4: NBPE Overview
NBPE OVERVIEW |
Slide 5: Investing in the Equity and Debt of Private Equity-backed Companies
Investing in the Equity and Debt of Private Equity-backed Companies High-quality portfolio with 69% of the portfolio invested in direct investments PORTFOLIO (% of Private Equity Fair Value) Income focus: 9.8% cash yield to maturity / Equity • Primarily equity co-investments with 10.5% total yield t
Slide 6: Our Manager’s Competitive Advantages
Our Manager’s Competitive Advantages Our Manager, NB Alternatives, provides NBPE with access to its proprietary transaction flow and insights for both direct private equity and income investments Private equity investor for over 27 years INFORMATION Integrated platform across fund and direct inv
Slide 7: Equity Investment Strategy
Equity Investment Strategy NBPE focuses on direct private equity co-investments alongside leading private equity firms in their core areas of expertise, utilizing the substantial relationships and resources of our Manager INVESTMENT FOCUS High quality businesses Reasonable investment valuations
Slide 8: Private Equity has Consistently Purchased Companies at Lower Valuations than the Public Markets
Private Equity has Consistently Purchased Companies at Lower Valuations than the Public Markets in the United States Private equity offers attractive valuations relative to public markets in the United States PUBLIC VS. PRIVATE VALUATIONS 16x 14.7x 14x 12.7x 12x 11.2x 10.2x 10.6x 10x 8.8x 8.7x 8.8x
Slide 9: Income Investment Strategy – Private Debt
Income Investment Strategy – Private Debt NBPE focuses on junior debt investments in private equity-backed companies INVESTMENT FOCUS Established and stable private equity-backed companies Second lien / mezzanine portions of capital structure High-quality private equity sponsorship OUR MANAGER
Slide 10: Private Debt – Providing Income while Benefiting From a Substantial Illiquidity Premium
Private Debt – Providing Income while Benefiting From a Substantial Illiquidity Premium Investing in the private debt of private equity-backed companies provides an illiquidity premium while having historically lower default rates FIXED INCOME YIELDS (CURRENT- OCTOBER 2014)(1) DEFAULT RATES OF SPONS
Slide 11: Income Investment Strategy – Healthcare Credits
Income Investment Strategy – Healthcare Credits NBPE focuses on investing in middle-market commercial stage healthcare companies INVESTMENT FOCUS Middle-market commercial-stage healthcare companies Growth-oriented transactions Focus on downside protection with upside participation through equi
Slide 12: Strong Performance
Strong Performance1 NBPE has performed NBPE CUMULATIVE RETURNS well over the short, of 31 October 2014 medium and long-term Cumulative Returns Over Year One Three Five Since NBPE driven by capital Time to Date Year Year Year Inception appreciation and income TOTAL RETURN NAV INCL. DIVIDENDS 11.3% 15
Slide 13: Our Contractual Income Allows Us to Pay a Covered Dividend to Our Shareholders
Our Contractual Income Allows Us to Pay a Covered Dividend to Our Shareholders 124% dividend coverage from run rate cash income 124% Dividend Coverage Yield income: From Cash Income1 9.8% cash yield / Annualized Dividend Yield2: 10.5% total yield • 3.9% on share price • 3.3% on NAV Income 2014 divid
Slide 14: Relative Discount to NAV
Relative Discount to NAV As of 31 October 2014, NBPE trades at a 17.5% discount to NAV DISCOUNT TO NAV COMPARISON VS. PEER GROUP1,2 % Premium / (Discount) to NAV 5.0% 3.3% Our NAV performance has outperformed all three peer 0.0% groups over the short, medium and long term -5.0% Our discount is great
Slide 15: Portfolio Update
PORTFOLIO UPDATE |
Slide 16: NBPE NAV Update
NBPE NAV Update 85% of NAV invested in NBPE SUMMARY BALANCE SHEET direct investments and 31 October 2014 31 December 2013 ($ in millions, except per share values) (Unaudited) (Audited) NAV per Share of Legacy Fund Investments $254.6 $291.7 Direct / Co-investments $13.81 Income Investments 317.9 185.
Slide 17: NBPE Diversification by Fair Value
NBPE Diversification by Fair Value The majority of the portfolio is invested in equity co-investments and income investments with a tactical over allocation to investments in North America INVESTMENT TYPE GEOGRAPHY Europe Asia/ROW Income 11% 5% Equity Investments Investments 38% 31% Legacy Fund Inve
Slide 18: NBPE Capital Position
NBPE Capital Position Strong capital position NBPE CAPITAL POSITION with an adjusted 31 October 2014 ($ in millions) (Unaudited) commitment coverage Cash Balance $25.0 ratio of 125% Available Credit Facility 110.0 Total Available Capital Resources 135.0 Adjusted for Adjusted Unfunded Commitments1 (1
Slide 19: Historical Quarterly Cash Flows
Historical Quarterly Cash Flows Since the beginning of Q4 2013, NBPE has received $226 million in distributions and contributed $310 million to new investments HISTORICAL QUARTERLY CASH FLOWS $ in millions $120 $100.1 $100 $84.9 $76.5 $80 $65.9 $71.5 $12.5 $59.5 $74.1 $60 $47.7 $35.4 $26.8 $42.3 $40
Slide 20: 2014 Realisation Events – Equity Investments and Legacy Fund Investments
2014 Realisation Events – Equity Investments and Legacy Fund Investments1 Attractive realisation events during 2014 YEAR TO DATE REALISATION ACTIVITY: EQUITY INVESTMENTS AND FUNDS Realisation events during 2014: NBPE has received $94.7mm of distributions from liquidity events Average Uplift Across P
Slide 21: New Equity Investments
New Equity Investments1 Representative new investments during 2014 YEAR TO DATE NEW EQUITY INVESTMENTS $79.2mm funded to 16 new equity investments. During July – October 2014, NBPE funded $35.1mm to new equity investments New investments across industrials, technology, consumer products and healthca
Slide 22: Equity Investments
Equity Investments The equity co-investment portfolio includes 56 companies alongside over 35 sponsors and represents approximately $258 million of fair value EQUITY INVESTMENTS CHARACTERISTICS TOP TEN EQUITY INVESTMENTS (ALPHABETICAL) As of October 31, 2014 $257.5m of fair value in 56 companies in
Slide 23: 2014 Realisation Events – Income Investments
2014 Realisation Events – Income Investments1 Year to date, NBPE has received interest payments of $18.8mm YEAR TO DATE REALISATION ACTIVITY: INCOME INVESTMENTS Realisation events during 2014: NBPE has received $54.9mm of distributions, including $18.8mm of interest and $34.5mm of principal and $1.6
Slide 24: New Income Investments
New Income Investments1 Representative new investments during 2014 YEAR TO DATE NEW INCOME INVESTMENTS $159.2mm funded to 21 new income investments. During July – October 2014, NBPE funded $47.7mm to new income investments 13 new corporate private debt investments and eight new healthcare credit inv
Slide 25: Income Investments – Corporate Private Debt & Healthcare Credits
Income Investments – Corporate Private Debt & Healthcare Credits The income investment portfolio includes 40 investments and represents approximately $318 million of fair value TOTAL PORTFOLIO CHARACTERISTICS TOP TEN INCOME INVESTMENTS (ALPHABETICAL) $317.9mm of fair value in 40 investments. Gross a
Slide 26: Legacy Fund Investments
Legacy Fund Investments NBPE’s legacy fund portfolio is comprised largely of mid-cap buyout and special situations funds. The portfolio is in realisation mode and represents approximately $255 million of fair value Mature fund portfolio in realisation mode, largely invested in mid-cap buyout and spe
Slide 27: NBPE Share Price vs. NAV per Share Including Dividends
NBPE Share Price vs. NAV per Share Including Dividends Over the last 12 months, including dividends, NBPE’s share price has increased by 32.3% and NAV per Share has increased by 15.6% Price NAV / Share Incl. $16 Dividends: $14.67 $14 NAV / Share: $13.81 $12 Share Price: $11.40 $10 $8 $6 20.8mm share
Slide 28: Attractive Value Proposition
Attractive Value Proposition We believe that NBPE offers a compelling investment opportunity Capital appreciation and growth from equity and legacy fund investments Income through an attractive covered dividend, supported by the cash yield from our income portfolio Opportunity for narrowing the disc
Slide 29: Appendix
APPENDIX |
Slide 30: NBPE Equity Investment Portfolio
NBPE Equity Investment Portfolio Diversified portfolio of equity investments EQUITY INVESTMENT PORTFOLIO % of NBPE % of NBPE Company Name Asset Class Lead Sponsor Fair Value Company Name Asset Class Lead Sponsor Fair Value NAV NAV Acteon Large-cap Buyout KKR - 0% - 1% Kyobo Life Insurance Co. Mid-ca
Slide 31: Income Investment Portfolio
Income Investment Portfolio Approximately $317.9 million of income investments generating a current cash yield of 9.8% INCOME INVESTMENT PORTFOLIO 1 CASH + PIK EST. CASH TOTAL EST. INVESTMENT NAME SECURITY DETAILS INVESTMENT DATE FAIR VALUE COUPON YTM YTM Corporate Private Debt Investments Vestcom S
Slide 32: NBPE Legacy Fund Investment Portfolio
NBPE Legacy Fund Investment Portfolio Mature fund portfolio with approximately $254.6 million of fair value Unfunded Investment Name Asset Class Vintage Year Fair Value % of NBPE NAV Commitment NB Crossroads Fund XVIII - Mid-cap Buyout Mid-cap Buyout Funds Fund XVIII $7.1 $28.6 4.2% NB Crossroads Fu
Slide 33: Trading Information
Trading Information ORDINARY SHARE INFORMATION ZDP SHARE INFORMATION Trading Symbol: NBPE Trading Symbol: NBPZ Exchanges: Exchanges: London Stock Exchange & The Channel Euronext Amsterdam & London Stock Exchange Islands Securities Exchange Authority Limited Base Currency: USD Base Currency: GBP Bloo
Slide 34: Contact Information
Contact Information Registered Office: NB Private Equity Partners Limited Corporate Brokers: Oriel Securities P.O. Box 225 Neil Winward Heritage Hall, Le Marchant Street Tel: +44.20.7710.7600 St. Peter Port, Guernsey GY1 4HY Channel Islands Jefferies International Limited Tel: +44.(0).1481.716.000 G
Slide 35: Endnotes
Endnotes 1. The diversification analysis by asset class and investment type is based on the fair value of underlying fund investments and direct/co-investments. Determinations regarding asset class and investment type represent the Investment Manager’s estimates. Accordingly, the actual diversificat
Slide 36: Legal Disclaimer
Legal Disclaimer THE CONTENTS OF THIS DOCUMENT AND THE PRESENTATION ARE STRICTLY CONFIDENTIAL AND MAY NOT BE COPIED, DISTRIBUTED, PUBLISHED OR REPRODUCED IN WHOLE OR IN PART, OR DISCLOSED OR DISTRIBUTED BY RECIPIENTS TO ANY OTHER PERSON. ANY RECIPIENT OF THIS DOCUMENT AGREES TO KEEP PERMANENTLY CONF
Slide 37: Legal Disclaimer (Continued)
Legal Disclaimer Continued THE PROMOTION OF NBPE AND THE DISTRIBUTION OF THIS DOCUMENT AND THE PRESENTATION IN THE UNITED KINGDOM IS RESTRICTED BY LAW. ACCORDINGLY, THIS COMMUNICATION IS DIRECTED ONLY AT (I) PERSONS OUTSIDE THE UNITED KINGDOM TO WHOM IT IS LAWFUL TO COMMUNICATE TO, OR (II) PERSONS H
Slide 38: Legal Disclaimer (Continued)
Legal Disclaimer Continued BY ACCEPTING AND READING THIS DOCUMENT AND/OR ATTENDING THE PRESENTATION TO WHICH THIS DOCUMENT RELATES YOU WILL BE DEEMED TO HAVE REPRESENTED, WARRANTED AND UNDERTAKEN FOR THE BENEFIT OF NBPE, THE INVESTMENT MANAGER, NEUBERGER BERMAN AND OTHERS THAT (A) YOU ARE OUTSIDE OF
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