Candover Extends Investment Freeze

LONDON (Reuters) – British private equity firm Candover (CDI.L) said on Wednesday it is extending a standstill agreement on its 2008 fund as it continues discussions with investors over the future of the fund.

Candover said the fund suspension will continue until December 4, 2009, preventing it from making any new acquisitions.

The buyout firm made only one investment out of its 2008 fund — in oil and gas services group Expro International — before it said in March that it had run out of cash to honour its own 1 billion euro ($1.47 billion) commitment. It suspended new investments as other investors decided whether or not to continue.

Candover said on Wednesday it is considering alternative ownership structures but any change is dependent on the outcome of discussions with investors.

The firm ended takeover talks with potential suitors earlier this year and has said it is considering divorcing the listed private equity parent company, which has historically co-invested alongside external investors in Candover funds, from the private equity partnership.

Candover will revalue its portfolio at end-December, but said its companies are showing resilience in face of the difficult economic climate. Seven of its 10 largest investments are showing earnings above or broadly in line with last year, it said.

Shares were up 0.9 percent at 571.5 pence at 0833 GMT. The firm has previously put the net asset value of its portfolio at 902 pence per share as of end-June. (Reporting by Simon Meads; Editing by Hans Peters) ($1=.6802 Euro)