Neuberger Private Equity Partners Limited USD · LSE:NBPE
Neuberger Private Equity Partners Limited USD — NB Private Equity Partners — Investor Presentation (March 2014)
37 slides from Neuberger Private Equity Partners Limited USD's investor presentation, March 2014
Slide 1: NB Private Equity Partners
NB Private Equity Partners March 2014 Financial Information as of 28 February 2014
Slide 2: NB Private Equity Partners overview
NB Private Equity Partners NBPE is a closed end investment company providing investors with a diversified exposure to the private equity asset class and the opportunity for capital gains as well as current income NB PRIVATE EQUITY PARTNERS Liquid Private Equity Investment Manager Direct Investments
Slide 3: Neuberger Berman Private Equity Platform
Neuberger Berman Private Equity Platform NBPE benefits from the integrated private equity platform of Neuberger Berman, which provides superior deal flow and enhanced due diligence insights PRIVATE EQUITY PLATFORM Over $20 billion of commitments managed Industry Leadership: Over 26 FUND INVESTMENTS
Slide 4: NBPE 2013 & 2014 Year to Date Highlights
NBPE 2013 & 2014 Year to Date Highlights NBPE is successfully executing on its stated strategy • Increase in total return NAV Total return NAV per Share increased 11.9% during 2013 and 0.9% in the first two months of 2014 • Strong performance of direct investments Received distributions of $33.4 mil
Slide 5: NAV Update
NAV Update On a total return basis, including dividends, NBPE’s NAV per share increased 0.9% during the first two months of 2014 February 2014 NAV Update Total return NAV per Share increase 0.9% YTD 28 February 2014 31 December 2013 ($ in millions, except per share values) (Unaudited) (Audited) Fund
Slide 6: Diversified Private Equity Exposure
Diversified Private Equity Exposure The portfolio is well diversified and includes a meaningful and increasing exposure to equity co- investments and direct yielding investments, as well as a tactical over allocation to investments in North America Asset class by fair value Asset Class by Geography
Slide 7: Tactical Approach to Asset Allocation
Tactical Approach to Asset Allocation Focus on equity co-investments and direct yielding investments Current fair value by year of deployment 61% of fair value invested since the beginning of 2010 Current fair value by year of deployment 28% of fair value invested in equity co-investments 2010-2011
Slide 8: 2013 and 2014 YTD Portfolio Activity
2013 and 2014 YTD Portfolio Activity NBPE funded $167.3 million and received $188.6 million in distributions in 2013 2013 Portfolio Activity 2014 Year to Date Portfolio Activity $151.1 million contributed to direct investments $43.5 million contributed to direct investments $ in millions $ in millio
Slide 9: 2013 and 2014 Year to Date Distributions
2013 and 2014 Year to Date Distributions Distributions received increased each quarter during 2013, driven by proceeds from direct yielding investments and special situations funds 2013 QUARTERLY DISTRIBUTION ACTIVITY BY ASSET CLASS 2014 YTD DISTRIBUTIONS $ in millions $77.3 $80 $80 $2.8 $0.7 $3.5 $
Slide 10: Portfolio Company Performance Metrics
Portfolio Company Performance Metrics We analyzed the operational performance and valuation metrics of the 50 largest buyout companies based upon fair value at 31 December 2013 TRADITIONAL BUYOUT INVESTMENTS OTHER BUYOUT INVESTMENTS • Traditional buyout investments that were valued based on a • Powe
Slide 11: Company Performance Metrics: Buyout
Company Performance Metrics: Buyout Of NBPE’s top 50 buyout assets by fair value, 37 were traditional buyout companies with an aggregate fair value of $149.7 million as of 31 December 2013 WEIGHTED AVERAGE PERFORMANCE & VALUATION METRICS BY INDUSTRY SECTOR: TRADITIONAL BUYOUT Growth Multiple 71.7% /
Slide 12: Equity Co-investment Portfolio
Equity Co-investment Portfolio NBPE’s equity co-investment portfolio contains approximately $168.2 million of fair value and is diversified across sponsor, industry and vintage year EQUITY CO-INVESTMENTS • $168.2 million of fair value invested in equity co-investments, representing 27% of NBPE NAV •
Slide 13: New Equity Co-investments in the Past Twelve Months
New Equity Co-investments in the Past Twelve Months 13 new equity co-investments over the past twelve months from 1 March 2013 through 28 February 2014 totaling $41.9 million or 6.8% of NBPE NAV at 28 February 2014 Portfolio of Insurance Industry Loss Warranties Investment Date Mar. 2013 Mar. 2013 A
Slide 14: New Equity Co-investments in the Past Twelve Months (continued)
New Equity Co-investments in the Past Twelve Months (continued) 13 new equity co-investments over the past twelve months from 1 March 2013 through 28 February 2014 totaling $41.9 million or 6.8% of NBPE NAV at 28 February 2014 WTG Investment Date July 2013 July 2013 Dec. 2013 Dec. 2013 Jan. 2014 Jan
Slide 15: Direct Yielding Investment Portfolio
Direct Yielding Investment Portfolio NBPE’s direct yielding portfolio includes corporate private debt investments and healthcare credit investments totaling $184.7 million of fair value • Senior secured loans, second lien debt, mezzanine investments and PIK notes • $145.2 million of fair value Corpo
Slide 16: Corporate Debt Investments in the Past Twelve Months
Corporate Debt Investments in the Past Twelve Months Over the past twelve months, NBPE has participated in eight corporate debt investments. These investments totaled $72.1 million or 11.6% of NBPE NAV at 28 February 2014 KIK Custom Archroma Digital Insight Parsley Energy Taylor Precision P2 Energy
Slide 17: Healthcare Credit Investments in the Past Twelve Months
Healthcare Credit Investments in the Past Twelve Months Over the past twelve months, NBPE has participated in seven healthcare credit investments. These investments totaled $28.9 million or 4.7% of NBPE NAV at 28 February 2014 Diagnostic Specialty Drug Specialty PCP and Medical Device Specialty Drug
Slide 18: Capital Position
Capital Position NBPE has significant capital resources with a 145% commitment coverage level CAPITAL POSITION UNFUNDED COMMITMENTS Total capital resources $270.3m Unfunded commitments $186.1m Cash balance $70.3m NB Co-investment Program $87.6m Credit facility available $200.0m NB Healthcare Credit
Slide 19: Dividend Policy
Dividend Policy NBPE intends to pay sustainable dividends to Shareholders from the cash yield generated by direct yielding investments Dividend coverage $16.5 Cash yield covers 77% of DIRECT YIELDING Yield income: 9.4% cash yield1 million of run rate annual dividend INVESTMENTS cash income Corporate
Slide 20: NBPE Share Price vs. NAV per Share Including Dividends
NBPE Share Price vs. NAV per Share Including Dividends Over the last 12 months, NBPE’s share price has increased by 16.8% and NAV per Share including dividends has increased by 12.8%. NAV per Share including dividends was $13.34 at 28 February 2014 Price Volume (000's) $14 1,800 $13.34 $13 1,500 $12
Slide 21: ZDP Price and NAV per ZDP Share
ZDP Price and NAV per ZDP Share NBPE’s ZDP shares have consistently traded at a premium to accreted value since they were issued in late 2009. The GRY is currently 3.8% at the prevailing market price Price Volume (000's) 155.0p 150.38p 600 11.2% premium 150.0p 500 145.0p 400 140.0p 300 135.21p 135.0
Slide 22: Trading Liquidity
Trading Liquidity NBPE’s ordinary shares generated greater liquidity than reported by NYSE Euronext and the London Stock Exchange 2.9 million shares traded in January and February 2014 0.8 million shares traded on exchange and 2.1 million shares traded over the counter On exchange average daily trad
Slide 23: Attractive Value Proposition
Attractive Value Proposition We believe that NBPE offers a compelling investment opportunity Track Record Portfolio Dividends Long term track record Equity co-investments & direct Sustainable dividends yielding investments Experienced investment manager NBPE intends to pay Funded by a mature, cash w
Slide 24: 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 25: 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 26: Appendix: Portfolio & Valuation
APPENDIX: PORTFOLIO & VALUATION
Slide 27: NBPE Equity Co-investment Portfolio
NBPE Equity Co-investment Portfolio Diversified portfolio of equity co-investments $168.2 million of fair value 27% of NAV Investment % of Investment % of Company Name Asset Class Lead Sponsor Fair Value Company Name Asset Class Lead Sponsor Fair Value Year NBPE NAV Year NBPE NAV Acteon Mid-cap Buyo
Slide 28: Direct Yielding Investment Portfolio
Direct Yielding Investment Portfolio Approximately $184.7 million of direct yielding investments generating a current cash yield of 9.4% $184.7 million of fair value 30% of NAV INVESTMENT 1 CASH + PIK PIK EST. YIELD TO INVESTMENT NAME SECURITY DETAILS FAIR VALUE CASH YIELD DATE COUPON YIELD MATURITY
Slide 29: NBPE Fund Investment Portfolio
NBPE Fund Investment Portfolio Mature fund portfolio with approximately $283.7 million of fair value Vintage Unfunded % of Investment Name Asset Class Fair Value Year Commitment NBPE NAV NB Crossroads Fund XVIII Mid-cap Buyout Mid-cap Buyout Diversified $7.7 $27.9 4.5% NB Crossroads Fund XVII Fund X
Slide 30: Equity Co-investment Portfolio Performance
Equity Co-investment Portfolio Performance Our current equity co-investment portfolio has generated a 1.28x multiple of invested capital to date Equity Co-investments ($ in millions) # of Unique Equity Realized 28 Feb 2014 Total Value to % of Asset Class Co-investments Proceeds Fair Value Paid-in Ca
Slide 31: Equity Co-investment Portfolio Performance (continued)
Equity Co-investment Portfolio Performance (continued) Continued Equity Co-investments ($ in millions) # of Unique Equity Realized 28 Feb 2014 Total Value to % of Vintage Year Co-investments Proceeds Fair Value Paid-in Capital Fair Value 2014 2 - $8.7 1.00x 5.2% 2013 10 0.4 33.2 1.07x 19.7% 2012 8 4
Slide 32: Current Equity Co-investment Valuation
Current Equity Co-investment Valuation1 33 Companies within the equity co-investment portfolio were valued based on a multiple of EBITDA, with a weighted average valuation multiple of 9.7x LTM EBITDA and a weighted average leverage multiple of 4.9x LTM EBITDA as of 31 December 20131 ($ in millions)
Slide 33: NBPE Credit Facility & Covenants
NBPE Credit Facility & Covenants As of 28 February 2014, NBPE has no outstanding borrowings under the credit facility Total Asset Ratio Secured Asset Ratio Commitment Ratio Not to exceed 50% Not to exceed 80% If total asset ratio >25% and commitment ratio is >130%, then NBPE is restricted from makin
Slide 34: 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 35: 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 36: 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 37: Legal Disclaimer (continued)
Legal Disclaimer Continued BY 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 THE UNITED STATES AND ARE AN "INVESTMENT P
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