Neuberger Private Equity Partners Limited USD · LSE:NBPE
Neuberger Private Equity Partners Limited USD — NB Private Equity Partners — Investor Presentation (November 2015)
37 slides from Neuberger Private Equity Partners Limited USD's investor presentation, November 2015
Slide 1: NB Private Equity Partners
NB Private Equity Partners November 2015 Financial Information as of 31 October 2015 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: 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 28 years INFORMATION Integrated platform across fund and direct inv
Slide 4: 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 76% of the portfolio invested in direct investments PORTFOLIO (% of Private Equity Fair Value) Income focus: 9.8% cash yield / Equity • Primarily equity co-investments with 10.3% total yield to maturity I
Slide 5: NBPE Portfolio Summary
NBPE Portfolio Summary Significant liquidity from income investments and strong performance from equity co-investments during 2015 Investment Type Portfolio Value @ Portfolio Value @ Contributions Distributions ($ in millions) 1 Jan 2015 31 Oct. 2015 Equity Co-investments1 $311.4m $73.1m $63.9m $352
Slide 6: 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 Equity Asia/ROW 8% 5% Investments 43% Income Investments 33% Legacy Fund Inves
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 Purchased Companies at Lower Valuations than Public Markets
Private Equity has Purchased Companies at Lower Valuations than Public Markets in the United States Private equity offers attractive valuations relative to public markets in the United States PUBLIC VS. PRIVATE VALUATIONS 18x 16.7x 16.4x 15.5x 16x 14x 12.3x 12x 10.9x 10.3x 9.7x 10x 8.8x 8.7x 8.8x 8x
Slide 9: NBPE Equity Co-investment Valuation vs. Public and Private Indices
NBPE Equity Co-investment Valuation vs. Public and Private Indices NBPE’s equity co-investments are valued at reasonable multiples relative to public and private indices NBPE EQUITY CO-INVESTMENT PORTFOLIO VS. PUBLIC AND PRIVATE INDICES 18x 16.7x 16x 14x 12x 10.3x 10.3x 9.8x 10x 8x 6x 4x 2x 0x NBPE
Slide 10: Valuation Uplift: Equity Co-investments
Valuation Uplift: Equity Co-investments In 2014 and 2015, on average, NBPE exits have occurred at a premium to carrying values Uplift 25% 24.0% 19.3% 20% 15% 10% 7.7% 5% 0% 3 Quarters Prior 2 Quarters Prior 1 Quarter Prior Uplift _______________________ Note: As of 30 September 2015. Analysis includ
Slide 11: 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 12: 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 (SEPTEMBER 2015)(1) DEFAULT RATES OF SPONSORED VS
Slide 13: Equity Investment Case Study: CSC Service Works
Equity Investment Case Study: CSC Service Works KEY STATISTICS COMPANY OVERVIEW % of NAV 1 – 2% • Leading provider of outsourced services to the laundry and air Investment date March 2015 vending markets Lead investor Pamplona Capital Management • The company offers air vending services, water and v
Slide 14: Equity Investments
Equity Investments The equity co-investment portfolio includes 76 companies alongside over 40 sponsors and represents approximately $352.7 million of fair value EQUITY INVESTMENT CHARACTERISTICS TOP TEN EQUITY INVESTMENTS (ALPHABETICAL) As of October 31, 2015 $352.7m of fair value in 76 companies in
Slide 15: Income Investment Case Study: Deltek
Income Investment Case Study: Deltek KEY STATISTICS COMPANY OVERVIEW % of NAV 1 – 2% • Provides enterprise software and information solutions for Investment date July 2015 project based-businesses in the professional services and Lead equity investor Thoma Bravo government contracting markets Indust
Slide 16: Income Investments – Corporate Private Debt & Healthcare Credits
Income Investments – Corporate Private Debt & Healthcare Credits The income investment portfolio includes 42 investments and represents approximately $270 million of fair value TOTAL PORTFOLIO CHARACTERISTICS TOP TEN INCOME INVESTMENTS (ALPHABETICAL) $269.4 mm of fair value in 42 investments As of O
Slide 17: NBPE Capital Position
NBPE Capital Position Strong capital position NBPE CAPITAL POSITION with an adjusted 31 October 2015 ($ in millions) (Unaudited) commitment coverage Cash Balance $25.3 ratio of 206% Available Credit Facility 145.0 Total Available Capital Resources 170.3 Adjusted for Adjusted Unfunded Commitments 1 (
Slide 18: Contractual Income Allows NBPE to Pay a Covered Dividend to its Shareholders
Contractual Income Allows NBPE to Pay a Covered Dividend to its Shareholders 98% dividend coverage from run rate cash income 98% Dividend Coverage Yield income: From Cash Income1 9.8% cash yield / Annualized Dividend Yield2: 10.3% total yield • 4.4% on share price • 3.5% on NAV Income Annualized Div
Slide 19: Strong Performance
Strong Performance1 NBPE NAV has NBPE CUMULATIVE RETURNS performed well over the As of 31 October 2015 short, medium and Cumulative Returns Over Year One Three Five Since NBPE long-term driven by Time to Date Year Year Year Inception capital appreciation and TOTAL RETURN NAV income INCL. DIVIDENDS2
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, including dividends, NBPE’s share price has increased by 2.8% and NAV per Share has increased by 4.2% Price NAV / Share Incl. $16 Dividends: $15.74 $14 NAV / Share: $14.40 $12 Share Price: $11.26 $10 $8 $6 11.9mm shares
Slide 21: NBPE Direct Investment Portfolio: Key Statistics
NBPE Direct Investment Portfolio: Key Statistics NBPE’s direct investment portfolio is carried at attractive valuations and leverage remains reasonable EQUITY CO-INVESTMENTS (50% of NAV)1 INCOME INVESTMENTS (38% of NAV)1 Valuation Multiple: 10.3x LTM EBITDA Senior Leverage: 3.8x LTM EBITDA Leverage
Slide 22: Relative Discount to NAV
Relative Discount to NAV As of 31 October 2015, NBPE traded at a 21.8% discount to NAV DISCOUNT TO NAV COMPARISON VS. PEER GROUP1,2 % Premium / (Discount) to NAV 0% Our NAV performance has outperformed all three -2.6% -5% peer groups over the short, medium and long term -10% Our discount is greater
Slide 23: Attractive Value Proposition
Attractive Value Proposition We believe that NBPE offers a compelling investment opportunity Capital appreciation and growth from equity investments Income through an attractive covered dividend, supported by the cash yield from our income portfolio Strong capital structure and commitment coverage O
Slide 24: Appendix
APPENDIX |
Slide 25: NBPE NAV Update
NBPE NAV Update 89% of NAV invested in NBPE SUMMARY BALANCE SHEET direct investments and 31 October 2015 31 December 2014 ($ in millions, except per share values) (Unaudited) (Audited) NAV per Share of Direct / Co-investments Income Investments $269.4 $329.2 $14.40 Equity Investments 352.7 283.5 Tot
Slide 26: NBPE Equity Investment Portfolio
NBPE Equity Investment Portfolio Diversified portfolio of equity investments EQUITY INVESTMENT PORTFOLIO % of NBPE % of NBPE Company Name Asset Class Investment Date Lead Sponsor Fair Value Company Name Asset Class Investment Date Lead Sponsor Fair Value NAV NAV Acteon Large-cap Buyout Dec-12 KKR $2
Slide 27: Income Investment Portfolio
Income Investment Portfolio Approximately $269.4 million of income investments generating a current cash yield of 9.8% INVESTMENT MATURITY 1 CASH + PIK CASH TOTAL EST. INVESTMENT NAME SECURITY DETAILS FAIR VALUE DATE DATE COUPON YIELD YTM Corporate Private Debt Investments Highbridge Loan Management
Slide 28: NBPE Legacy Fund Investment Portfolio
NBPE Legacy Fund Investment Portfolio Mature fund portfolio with approximately $195.5 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 $21.1 3.0% NB Crossroads Fu
Slide 29: Private Equity Valuations
Private Equity Valuations Private equity companies are typically valued based on a multiple of EBITDA PRIVATE EQUITY VALUATIONS • Generally, private equity firms value portfolio companies based on a multiple of cash-flow, typically EBITDA • When choosing cash flow multiples, firms typically use a co
Slide 30: Debt Valuations
Debt Valuations DEBT VALUATIONS • If traded market quotations are available, NB reviews current pricing and liquidity • NB determines the enterprise value of each company and compares that to the total amount of debt as well as the level of debt senior to NBPE’s interest NB also evaluates the matur
Slide 31: NBPE Credit Facility & Covenants
NBPE Credit Facility & Covenants As of 31 October 2015, NBPE had $55 million of borrowings drawn 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
Slide 32: 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 33: Contact Information
Contact Information Registered Office: NB Private Equity Partners Limited Corporate Brokers: Stifel Nicolaus 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 Ga
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 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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