Bridgepoint Group Plc · LSE:BPT
Bridgepoint — Merger or Acquisition (September 2023)
41 slides from Bridgepoint's merger presentation, Sep 6, 2023
Slide 1: Executing on strategy: Adding a third growth pillar
CONFIDENTIAL 6 September 2023 Executing on strategy: Adding a third growth pillar
Slide 2: Today's speakers
Today’s speakers William Jackson Raoul Hughes Doug Kimmelman Adam Jones Chairman Group Managing Partner Senior Partner, Group CFO Founder of ECP 2
Slide 3: Bridgepoint + ECP: Building the platform and driving shareholder value
Bridgepoint + ECP: Building the platform and driving shareholder value ECP is a strategic addition in line with Bridgepoint’s stated IPO strategy which delivers: Addition of high growth infrastructure investing as a third leg to the Bridgepoint platform Enhanced market presence with material increas
Slide 4: Table of contents
Table of contents 1 Introduction and overview 2 ECP deep dive 3 A highly aligned transaction structure 4 A transaction driving shareholder value 5 Next steps and conclusion 4
Slide 5: Snapshot
Snapshot A leading global infrastructure investor and highly aligned transaction structure ECP The Transaction ˃ International Firm: Based in US with presence in Asia ˃ 95% of ECP’s FRE and nascent business in Europe ˃ 30% of carried interest in future funds and up to 15% in ˃ Track record: >25 year
Slide 6: Transaction Impact
Transaction Impact Enhances the quality of the group’s earnings and margin profile and is immediately accretive 2022 metrics Accretion1 Bridgepoint: Combined: AUM €38bn €57bn FRE per share >20% FRE £74m £121m EPS per share High single digit FRE Margin 31% 36% Based on ECP’s guided financial performa
Slide 7: Bridgepoint leadership team
Bridgepoint leadership team New structure in place to manage enlarged Bridgepoint Group and drive returns: ˃ The Group will split the roles of CEO and Chairman following the agreement to add ECP to the platform ˃ William Jackson will chair the Bridgepoint Group Board and continue to focus on Bridgep
Slide 8: Why value-add infrastructure?
Why value-add infrastructure? Infrastructure has grown significantly as an alternative asset class… … underpinned by structural trends AUM of global alternative investments by asset class ($tn)1 ▪ Demand for further private investment in 12.0 infrastructure due in part to: 10.4 1.3 ‒ Energy transiti
Slide 9: ECP deep dive
ECP deep dive
Slide 10: The ECP perspective: Why join forces with Bridgepoint?
The ECP perspective: Why join forces with Bridgepoint? Two highly complementary businesses with shared values and the ability to together accelerate investor and shareholder returns ˃ Great team fit: Share a culture of collaboration, integrity and investment excellence ˃ Scale: Opportunity to benefi
Slide 11: Within infrastructure, energy transition is amongst the fastest growing segments
Within infrastructure, energy transition is amongst the fastest growing segments The energy transition opportunity is significant… …with multiple tailwinds expected to drive continued growth Turbo-charged by societal demand for energy security, clean energy and sustainability solutions; supported by
Slide 12: ECP at-a-glance: A leading infrastructure firm focused on energy transition
ECP at-a-glance: A leading infrastructure firm focused on energy transition A market-leader in electrification, decarbonisation and sustainability-focused added value investing Track record Performance Scale Our funds are… Largest >18 years 1st quartile ~$11bn / Independent owner of ECP’s track reco
Slide 13: ECP targets the most attractive themes within energy transition
ECP targets the most attractive themes within energy transition Early mover advantage with a long history of navigating energy, regulatory and environmental transitions Target sectors Investment parameters Wind, solar, geothermal, hydro, waste-to- Electricity & reliability linked Renewables & storag
Slide 14: Attractive spectrum of investment products
Attractive spectrum of investment products Enhanced and diversified product offering to enlarged client base of combined Bridgepoint & ECP Group FPAUM AUM Blended net IRR Funds raised (31 Dec 2022) (31 Dec 2022) (30 Jun 2023) Pipeline ECP V fundraising finalising Flagship funds I–V €7.6bn €14.9bn 17
Slide 15: A highly aligned transaction structure
A highly aligned transaction structure
Slide 16: Bridgepoint + ECP: Key attractions in detail
Bridgepoint + ECP: Key attractions in detail Combination reinforces the group’s position as a global leader in mid-market private assets investing Increases ECP is a market leading Highly Enhances the quality of Bridgepoint’s scale and infrastructure investor complementary fit for the group’s earnin
Slide 17: Bridgepoint post transaction
Bridgepoint post transaction Retaining the leadership, culture and investment framework that have made both Bridgepoint and ECP successful Bridgepoint Group plc, €57bn AUM Private Equity Private Credit Infrastructure €27bn AUM €11bn AUM €19bn AUM >130 Investment FTEs >55 Investment FTEs >45 Investme
Slide 18: Accelerating growth in the combined business
Accelerating growth in the combined business Potential synergies between existing strategies and ECP (none assumed in guidance) Bridgepoint’s value add to ECP: ECP’s value add to Bridgepoint: ˃ European office footprint and network ˃ Extended North American office footprint, local relationships and
Slide 19: Strategically and financially compelling transaction with aligned incentives
Strategically and financially compelling transaction with aligned incentives Summary transaction terms Day 1 transaction consideration / incentives Deferred consideration/Aligned incentives Transaction perimeter £835m 19% 95% Day 1 Enterprise value1 of enlarged Day 1 Bridgepoint share capital held o
Slide 20: A transaction driving shareholder value
A transaction driving shareholder value
Slide 21: Accretive for Bridgepoint shareholders
Accretive for Bridgepoint shareholders High visibility into ongoing fundraising cycle expected to drive significant top- and bottom-line growth Medium-term guidance for ECP ˃ ECP V targeting final close by early 2024 of $4bn, of which >40% has already been committed; successor fund ECP VI expected t
Slide 22: Immediately enhances Bridgepoint's earnings profile
Immediately enhances Bridgepoint’s earnings profile Increases management fee centricity of earnings whilst enhancing margins and diversifying revenues FRE margin (%) FRE (as % of EBITDA) ~£50m Management fee split1 EBITDA Credit Infra- 61% 20% structure2 53% 25% Credit 36% 15% 31% Private Equity Pri
Slide 23: Returning capital to shareholders: New £50m share buyback
Returning capital to shareholders: New £50m share buyback The Board remains committed to a disciplined capital allocation programme to drive returns for shareholders The business benefits from strong cash generation and a robust balance sheet, including post-ECP A further £50m share repurchase progr
Slide 24: Multiple potential further growth drivers (upside to guidance)
Multiple potential further growth drivers (upside to guidance) ▪ Macro tailwinds: Strong LP appetite and increase in strategic sell downs Core Infrastructure ▪ ECP track record includes numerous assets sold to core infrastructure funds and one core SMA already in place fund ▪ ECP positioning creates
Slide 25: In summary, the transaction brings together two highly complementary businesses
In summary, the transaction brings together two highly complementary businesses Strong cultural fit Highly complementary geographic focus Shared ECP and Bridgepoint Values: Combined platform will have Fund investors come first >460 FTEs across1 Collegial approach 14 offices in Longevity of talent Eu
Slide 26: Next steps and conclusion
Next steps and conclusion Bridgepoint
Slide 27: Next steps and conditions to completion of transaction
Next steps and conditions to completion of transaction • Transaction conditional upon shareholder approval, with general meeting expected to take place in October. Circular convening general meeting to be published in due course • Directors unanimously recommend that shareholders vote in favour of t
Slide 28: Concluding thoughts
Concluding thoughts The combination with ECP brings material benefits to the enlarged Bridgepoint group and delivers on the strategy communicated at IPO ECP is a leading infrastructure fund focusing on electrification, decarbonization and sustainability-focused investing with principals that have a
Slide 29: Appendix
Appendix Bridgepoint
Slide 30: Summary of key transaction terms
Summary of key transaction terms ▪ Bridgepoint to set up an UP-C structure prior to closing, establishing a new limited partnership (the “Partnership”), which will issue equity to ECP’s Senior Partners1 and funds managed by Blue Owl in the form of units in the Partnership (“Partnership units”) UP-C
Slide 31: Summary of proposed UP-C structure
Summary of proposed UP-C structure Simplified structure at transaction closing Expected structure 4 years post closing1 (post conversion of Partnership units) Existing Bridgepoint ECP owners Existing Bridgepoint shareholders and Broader ECP team shareholders (other than Dyal) ECP owners as Bridgepoi
Slide 32: Evolution of Bridgepoint's shareholder mix
Evolution of Bridgepoint’s shareholder mix Expected position 4 years post closing (issuance of maximum employee incentives and ECP Today At transaction closing earnout equity2) Public Public Public Bridgepoint¹ Bridgepoint¹ Bridgepoint¹ Shareholders Shareholders Shareholders 55% 42% 39% 23% 21% 30%
Slide 33: ECP has a long history of navigating energy, regulatory and environmental transitions
ECP has a long history of navigating energy, regulatory and environmental transitions… Doug Kimmelman Expansion into Accelerated execution of renewable Leads Goldman Focus on Hydro & ECP Focus on New, Efficient Environmental, Waste (wind, solar, and storage) and 9 deals in last 2 years – primarily S
Slide 34: … and is constantly refining its investment strategy to maximise the opportunity set
… and is constantly refining its investment strategy to maximise the opportunity set Portfolio sector composition 16% 20%-30% 28% 33% Sector mix % based on invested capital 40% 22% 21% 25%-40% 13% 27% 9% 42% 24% 9% 6% 25%-40% 7% 38% 25% 19% 20% 10%-20% ECP Fund I ECP Fund II ECP Fund III ECP Fund IV
Slide 35: Strong and consistent investment performance
Strong and consistent investment performance 3-year rolling vintages (based on current sector focus)1 2.2x 2.2x 2.2x 2.2x 2.2x 2.3x 2.1x 2.1x 2.0x 1.9x Gross MOIC '10-'12 '11-'13 '12-'14 '13-'15 '14-'16 '15-'17 '16-'18 '17-'19 '18-'20 '19-'21 ECP III (2014) ECP IV (2018) Quartile ranking 2nd 1st ECP
Slide 36: Highly complementary client relationships
Highly complementary client relationships ¹ ² MENA3 MENA3 APAC By geography 6% Client base 9% 22% 43% 47% Americas Americas Europe 38% significantly APAC 18% enhanced 17% Europe Endowments / Foundations / Family Offices Other >170 new client relationships to Endowments / Other Foundations / Bridgepo
Slide 37: Highly complementary geographic focus
Highly complementary geographic focus By investment FTEs APAC Americas APAC 2% 9% 2% Combined platform will have >460 FTEs 89% 98% Europe Americas across Americas Europe By invested capital1 5% 14 offices 10% in Europe, US and Asia Americas 95% 90% Europe 37 ¹ Invested capital by HQ of portfolio com
Slide 38: Select metrics on a combined basis: 2022 full year
Select metrics on a combined basis: 2022 full year % of total FPAUM1 (€bn) 24 10 34 31% Management fees (£m) 242 89 331 27% Total operating income 307 101 408 25% (£m) FRE (£m) 74 46 121 38% FRE margin (%) 31% 52% 36% 55m — Earn-out shares EBITDA (£m) 139 58 197 29% EBITDA margin (%) 45% 57% 48% — F
Slide 39: Bridgepoint interim 2023 guidance
Bridgepoint interim 2023 guidance: taken from Bridgepoint interim results presentation Fundraising Investment income Costs FRE Margin Credit deployment Continued progress on BE VII Continue to expect investment Some inflationary pressures on Short term guidance remains Expect to deploy at least €1bn
Slide 40: Overview of ECP funds
Overview of ECP funds Generated cash Group share of Gross MOIC Fund Fund size1 AUM 1,2 FPAUM1,2 Vintage Invested % Mgmt. fee basis Mgmt. fee rate3 Carried interest carried interest carried interest targets yet? Flagship ECP III $5,050 €5,651 €2,534 2014 100% 1.55 / 1.0%6 20% 0% ~2.0x Imminent Commit
Slide 41: Disclaimer
Disclaimer THE DOCUMENT IS NOT AN OFFER OR SOLICITATION OF AN OFFER TO BUY OR SELL SECURITIES. IT IS SOLELY FOR USE AT A PRESENTATION AND IS PROVIDED FOR INFORMATION ONLY AND MUST NOT BE RELIED UPON FOR ANY PURPOSE. THIS PRESENTATION DOES NOT CONTAIN ALL OF THE INFORMATION MATERIAL TO AN INVESTOR. I
Bridgepoint Group — Merger or Acquisition (September 2023) on 6ix