Disposal

RNS Number : 0008B

HG Capital Trust PLC

10 February 2011

 



HgCapital has agreed to sell its investment in SiTel (investment held as Elite Holding SA).HgCapital Trust plc, the listed investment trust which invests in all HgCapital's deals alongside its institutional clients, will immediately realise estimated cash proceeds of £9.6 million. This compares to a carrying value of £3.6 million in the Net Asset Value (NAV) of the Trust at 30 November 2010, an uplift of £6.0 million (19.6 pence per share basic; 16.3 pence per share fully diluted*). Based on the 30 November 2010 NAV and following completion of this and our other announced transactions that completed after the last published NAV, and before taking into consideration the revaluation of the investment portfolio at 31 December 2010, the NAV of HgCapital Trust plc is estimated to be £327.2 million (1,052.0 pence per share basic; 1,035.0 pence per share fully diluted*) and liquid resources are estimated to be £91.0 million (27.8% of the estimated NAV).

*The calculation of fully diluted earnings per share assumes that all subscription shares in issue are exercised at their minimum price of 950 pence.

Set out below is the text of a press release issued today by HgCapital announcing the divestment.

HgCapital announces the sale of SiTel

London, 10 February 2011: HgCapital has today announced the sale of SiTel Semiconductor ("SiTel"), the Netherlands-based producer of products targeted primarily at the home wireless voice and data applications market, to Dialog Semiconductor Plc for an enterprise value of $86.5 million, which represents a realisation of nearly 2.4x original cost.  This is HgCapital's 35^th realisation over the last five and a half years, representing an overall investment multiple of 2.6x original cost and a gross IRR of over 30%.

This transaction follows HgCapital's majority realisation of Nordic SME software provider Visma in September 2010, which represented a total return of 3.7x original cost to investors.  A consistent, thematic approach to targeted sub-sector TMT investing has delivered seven realisations averaging more than 3x cost and 46% IRR since 2006, with no single TMT exit delivering an investment return of less than 2.1x cost. Since 2001, buyout investments completed by HgCapital's dedicated TMT sector team have returned more than £800 million in realised proceeds to clients and have resulted in the aggregate creation of more than 4,000 new jobs during HgCapital's period of ownership.

HgCapital acquired the cordless business unit of the National Semiconductor Corporation, known as SiTel, in June 2005.  HgCapital has worked closely with SiTel's management to establish the business as a strong, independent entity supporting expansion into areas such as "Voice over Internet Protocol" (VoIP) chips and gaming peripherals.  The business was subsequently able to perform strongly throughout the downturn, with EBITDA increasing by over 61% between 2008 and 2010.

Commenting on the realisation, Nick Turner, a Partner with HgCapital, stated: "It has been a pleasure working together with Asmund Tielens and his management team. SiTel is a high quality business with a leadership position in its core market; and, not for the first time, we have seen the rewards for backing such a business with increased research and development spending to accelerate its growth. We are pleased to see it become part of a group which will allow the team to continue to build on this success." 

Nic Humphries, CEO of HgCapital, said: "The sale of SiTel supports HgCapital's established track record for successful sub-sector, thematic investing in the TMT space.  Our performance in this sector indicates that we are very well positioned to continue building a compelling competitive advantage within the European TMT market." 

HgCapital and SiTel were advised in this transaction by Mooreland Partners.

- Ends -

For further details please contact:

HgCapital:	Nick Turner	[phone]
	Dan Groen	[phone]
Maitland:	Neil Bennett	[phone]
		[phone]

About HgCapital Trust plc

HgCapital Trust plc is an investment trust whose shares are listed on the London Stock Exchange.  The Trust is a client of HgCapital, giving investors exposure to a portfolio of high-growth private companies, through a liquid vehicle.  New investments and existing portfolio companies are managed by HgCapital, an experienced and well resourced private equity firm with a long-term track record of delivering superior risk-adjusted returns for its investors.  The Trust has won the Investment Week Private Equity Investment Trust of the Year in 2005, 2006, 2007, 2008, 2009 and 2010.   For further details, please see www.hgcapitaltrust.com

About HgCapital

HgCapital is a private equity investor focused on the European middle market. Its business model combines sector-specific thematic investing with dedicated portfolio management support. HgCapital seeks to invest in growth companies in expanding sectors which create jobs across Western Europe.

HgCapital is also an investor in renewable energy, establishing itself as a market leader by building a dedicated energy investment team in 2004. It continues to invest a dedicated fund in a range of renewable power technologies across Western Europe.

HgCapital manages over £3 billion for some of the world's leading institutional and private investors.  For further details, please see www.hgcapital.com.

Neither the contents of HgCapital's or SiTel's website nor the contents of any website accessible from hyperlinks on the websites (or any other website) is incorporated into, or forms part of, this announcement.

 

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