SVG Portfolio Drops, Sees Stabilization Signs

LONDON (Reuters) – Private equity firm SVG Capital plc (SVI.L) said its portfolio slumped by almost a fifth in value in the first six months of the year, but it had seen signs its underlying business was stabilising.

SVG, the largest investor in European buyout house Permira, said its net asset value fell 18 percent to 171 pence a share in the six months to end-June.

Its shares were down 3.1 percent in early trading.

Much of the fall was due to currency effects, it said, and the portfolio fell just 5 percent when reported in local currencies, after steep declines last year.

“Many of the more mature investments have performed well, demonstrating their defensive qualities despite the difficult market environment,” chief executive Lynn Fordham said in a statement.

Permira continues to work closely with company management teams to stave of the effects of the downturn, with many of its firms taking market share from competitors, SVG said.

SVG’s net asset value declined 64 percent last year, reflecting big writedowns on Permira assets, including those in gaming group Gala Coral, broadcaster ProSiebenSat.1 (PSMG_p.DE), and chipmaker Freescale.

The company reiterated its stance that no new commitments to third party fund will be made until it is in a position to return cash to shareholders.

Despite talk of a re-opening of the IPO market, with a number of Permira firms including frozen food firm Birdseye Iglo and budget fashion retailer New Look touted as potential candidates for listings, SVG said it did not expect to receive major distributions over the next 12-18 months. (Reporting by Simon Meads; Editing by Dan Lalor)