Britain’s SVG Capital agreed to sell its investment portfolio to HarbourVest for about 807 million pounds (US$991 million) after the private equity firm elbowed out a Goldman Sachs Group-led consortium with a sweetened offer.
SVG said HarbourVest’s offer of 715 pence per share represents a 0.6 percent premium to the value of its investment portfolio at the end of July.
The firm had previously accepted an offer of 680 pence per share, or 748 million pounds (US$950 million), from Goldman Sachs and the Canada Pension Plan Investment Board for the portfolio.
SVG said the portfolio sale and a wind down of the company would generate superior value, compared with HarbourVest’s US$1.35 billion bid for the entire firm and Goldman Sachs-led offer.
SVG said on Tuesday that its expected to return about 1.12 billion pounds to shareholders through a series of tender offers.
HarbourVest confirmed the portfolio purchase and said its offer for the whole firm would lapse on Tuesday.
HarbourVest launched a bid for the SVG on September 12, saying it was taking advantage of a weaker pound, following the Brexit vote, to snap up assets with good short-term growth prospects.
Investors have been frustrated for years with Britain’s listed private equity sector as it has traded at a discount to the value of its assets, prompting some activist investors to step in.
A Goldman Sachs spokesman declined to comment when contacted by Reuters.
J.P. Morgan Cazenove, Lazard & Co and Numis Securities are SVG’s financial advisers.
SVG shares were up 2.18 percent at 703 pence at 1306 GMT on the London Stock Exchange.
(Reporting by Noor Zainab Hussain in Bengaluru; Editing by Anil D’Silva)
Photo courtesy of Reuters/Catherine Benson