CapMan incorporates own fund investments and sells investment commitments and fund investments worth EUR 17.0 million to Gimv

 

CapMan Plc and Belgian-based private equity firm Gimv have signed an agreement according to which CapMan will divest investment commitments and fund investments worth EUR 17.0 million to Gimv. The sale of the commitments will reduce CapMan Plc’s capital calls in the coming years and strengthen the Group’s financial position. The direct impact of the arrangement on the Group’s cash flow in 2009 is approx. EUR 3.4 million. The arrangement does not have an impact on Group’s result. The closing of the arrangement requires i.a. the approval of the relevant regulatory authorities. In addition, CapMan will transfer its investment commitments and fund investments in CapMan funds to CapMan Fund Investments SICAV SIF (CapMan Fund Investments or feeder fund), a new company that will operate as a feeder fund into funds managed by CapMan. Gimv has stated in its Stock Exchange release published today that it intends to increase its shareholding in CapMan Plc up to approx. 10%. Moreover, Gimv states to aim at having a representative appointed on the Board of Directors of CapMan Plc in connection with the next General Meeting, with support from CapMan Partners B.V.

 

 

CapMan will divest investment commitments totalling EUR 13.6 million and fund investments totalling EUR 3.4 million to Gimv. The commitments and investments target CapMan Technology 2007, CapMan Russia and CapMan Public Market funds as follows:

 

 

As a result of the divestments, the sum of CapMan’s remaining investment commitments falls from EUR 61.9 million to EUR 48.3 million. The fair value of executed investments at 30 June 2009 changes from EUR 56.2 million to EUR 52.8 million. The transactions will be executed at fair value and therefore they will not have an impact on Group’s result for 2009. It is expected that the transactions will be closed during August 2009.

 

 

CapMan’s intention to incorporate its own fund investments and to have third party investors in the possible new vehicle to be formed was announced for the first time in the Interim Report published on 30 October 2008.

 

CapMan has established a new company, CapMan Fund Investments, which will operate as a feeder fund into funds managed by CapMan. The incorporation of fund investments clarifies the difference between CapMan’s management company business and its fund investment business. CapMan has transferred part of its own investment commitments and fund investments to the feeder fund on 30 June 2009. Moreover, CapMan will transfer also the remaining commitments and investments made as a fund investor to the feeder fund by the end of the first quarter of 2010. The transfers will impact the parent company’s distributable assets. The impact will depend on the fair value of the transferring investments on the transfer date. The so far implemented transfers have an effect of EUR -1.8 million, and in case all investments had been transferred on 30 June 2009 the impact would have been EUR -7.0 million.

 

Gimv will become the other investor in the feeder fund when the now announced sale of investment commitments and fund investments is closed. Gimv has already invested in CapMan Buyout VIII fund and is committed to invest in CapMan Buyout IX fund. Gimv’s intention is to make future fund investments in CapMan funds through the feeder fund. It also intends to re-invest a part of the potential proceeds to be received from these investments in CapMan’s future funds.

 

Commitments and fund investments made by Gimv will not be consolidated with the figures of the CapMan Group. New investors may participate in the feeder fund in future.

 

Gimv has today published a Stock Exchange release stating that it owns 4.38% of shares in CapMan Plc. According to the release Gimv intends to further increase its shareholding up to approx. 10%, which however is, according to the release, fully dependent on the liquidity and market price of CapMan Plc shares. Moreover, Gimv states to aim at having a representative appointed on the Board of Directors of CapMan Plc in connection with the next General Meeting, with support from CapMan Partners B.V.. CapMan Partners B.V. is owned by the Senior Partners of CapMan and it holds 5.98% of the CapMan Plc shares and 23.24% of the voting rights. 

 

“Gimv is a good cooperation partner for CapMan. As a strong European private equity house Gimv understands the industry logic and future opportunities. In addition to the fund investments made, we can cooperate for example in generating deal flow for different investment areas and in developing value creation practices”, states Heikki Westerlund, CEO of CapMan Plc. “The sale of the investment commitments and fund investments will strengthen CapMan’s financial position in the next few years, yet at the same time CapMan maintains its position as a substantial investor in the Group’s funds,” continues Westerlund.

 

“We have a strong belief in CapMan and its product range and we consider this transaction a natural continuation of our existing business relation. Apart from a different geographical focus, our businesses are very similar. This complementarity allows for openness and knowledge sharing between our companies,” states Koen Dejonckheere, CEO of Gimv nv.

 

CapMan Plc’s objective is to invest in its future funds 1-5% of the original capital depending on the fund’s demand and CapMan’s own investment capacity.

 

Heikki Westerlund, CEO, CapMan Plc, tel. +358 50 559 6580

 

CAPMAN PLC

 

Mari Reponen

Communications Director

Investor Services

 

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Helsinki Stock Exchange

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www.capman.com