Estimate NAV at 31 October 2023

abrdn Private Equity Opp Trst plc

15 November 2023

 

abrdn Private Equity Opportunities Trust plc

Legal Entity Identifier (LEI): 2138004MK7VPTZ99EV13

15 November 2023

abrdn Private Equity Opportunities Trust plc ("APEO" or "the Company") announces its estimated net asset value ("NAV") at 31 October 2023

·      Estimated NAV at 31 October 2023 was 767.6 pence per share (estimated NAV at 30 September 2023 was 769.4 pence per share), a 0.2% decrease from the month of September

·      Excluding new investments, 100.0% by value of portfolio dated 30 June 2023 (estimated NAV at 30 September 2023 was 100.0% dated 30 June 2023)

·      Third interim dividend of 4.0 pence per share paid on 27 October 2023

·      APEO paid £8.3 million of drawdowns to existing commitments and received £2.5 million of distributions from fund investments during the month of October

·      One new primary fund commitment and one new co-investment made in October

·      Outstanding commitments of £674.3 million at 31 October 2023

·      Liquid resources (cash balances plus undrawn credit facilities) were £219.2 million as at 31 October 2023

APEO's valuation policy for private equity funds and co-investments is based on the latest valuations reported by the managers of the funds and co-investments in which the Company has interests. In the case of APEO's valuation at 31 October 2023, excluding new investments, 100.0% by value of the portfolio valuations were dated 30 June 2023. The value of the portfolio is therefore generally calculated as the 30 June 2023 valuation, adjusted for subsequent cashflows over the period to 31 October 2023.

This is substantially unchanged from the estimated NAV at 30 September 2023, whereby 100.0% of the portfolio valuations, excluding new investments, were also dated 30 June 2023, adjusted for subsequent cashflows over the period to 30 September 2023.

Estimated NAV

At 31 October 2023, APEO's estimated NAV was 767.6 pence per share (estimated net assets £1,180.1 million), representing a 0.2% per share decrease from the estimated NAV at 30 September 2023 of 769.4 pence per share (estimated net assets £1,183.0 million). The 1.8 pence decrease in NAV per share reflected the third interim dividend payment of 4.0 pence per share on 27 October 2023 at a total cash cost of £6.1 million. This was partially offset by gains arising from a 0.4% appreciation in the euro versus sterling and a 0.6% appreciation in the dollar versus sterling during October.

Drawdowns and distributions

APEO paid £8.3 million of drawdowns to existing commitments and received £2.5 million of distributions from fund investments and during the month of October. Including the funding of a new co-investment, total net outflows from investment activity during October amounted to £11.6 million.

Drawdowns during the period were across several of APEO's fund investments, primarily to fund new underlying portfolio company investments and management fees.

The distributions received generated realised gains and income of £1.6 million.

As communicated in the September announcement, APEO also received proceeds of €34.6 million during October following a partial realisation of Action which was completed during September.

Investment activity

A new primary commitment of €30.0 million was made to IK X, a fund focusing primarily on investing in lower middle market businesses in Northern Continental Europe across Business Services, Consumer/Food, Healthcare and Industrials.

A €6.0 million co-investment was made alongside IK Partners into an undisclosed company, which is a leading manufacturer of frozen snacks in Europe, with a diversified business mix across Retail, Out-of-Home and Industry.

Commitments

The Company had £674.3 million of outstanding commitments at 31 October 2023. The Manager believes that around £97.8 million of the Company's existing outstanding commitments are unlikely to be drawn.

Credit facility and cash balances

The Company has a £300.0 million syndicated revolving credit facility provided by The Royal Bank of Scotland International Limited, Societe Generale and State Street Bank International GmbH, and it expires in December 2025. The Company repaid a total of £8.7 million to the credit facility during the month of October, reducing the total drawn balance to £94.1 million at 31 October 2023. The remaining undrawn balance of the facility at 31 October 2023 was therefore £205.9 million.

In addition, the Company had cash balances of £13.3 million at 31 October 2023. Liquid resources, calculated as the total of cash balances and the undrawn balance of the credit facility, were therefore £219.2 million as at 31 October 2023.

Update from the Manager

Private Equity merger & acquisition ("M&A") activity in 2023 has been relatively subdued when compared to levels seen in recent years and this has impacted the cashflows of APEO's portfolio of investments. October was no different in this regard, with particularly low levels of distributions from APEO's fund investments (£2.5 million), albeit drawdowns were relatively modest too (£8.3 million), with the drawdown figure also including amounts for the repayment of underlying fund credit facilities that were used to finance investments originally made in 2022.

APEO's proactive partial realisation of its direct co-investment in Action has proven to be helpful from a cash perspective at this point in the market cycle. We would note that the disposals of Action shares have been achieved at 100% of its most recent quarterly valuation and it remains APEO's largest underlying portfolio company at c.2.0% of the value of the portfolio at 31 October 2023. 

On the new investment side, APEO has made two new investments with IK Partners during the month, with both a fund commitment and a direct co-investment. The relationship between IK and APEO stretches back over two decades, with IK's focus on mid-market buyout transactions in Northwestern Europe very much aligned with APEO's long-term investment strategy.

Lastly, from a balance sheet perspective, we continue to believe that APEO is well positioned, with £219.2 million of liquid resources available. Outstanding commitments of £674.3 million equate to an overcommitment ratio[i] of 38.6%, at the lower end of our target range of 30-75%.

We look forward to providing an update on performance in next month's November estimated NAV announcement, when we expect a large portion of the portfolio valuation to be revised and dated 30 September 2023. 

Future announcements

The Company is expecting to announce its estimated NAV at 30 November 2023 on or around 18 December 2023.

Additional detail about APEO's NAV and investment diversification can be found on APEO's website. Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website is incorporated into, or forms part of, this announcement.

For further information please contact Alan Gauld at abrdn Capital Partners LLP (0131 528 4424)

Notes:-

abrdn Private Equity Opportunities Trust plc is an investment company managed by abrdn Capital Partners LLP, the ordinary shares of which are admitted to listing by the UK Listing Authority and to trading on the Stock Exchange and which seeks to conduct its affairs so as to qualify as an investment trust under sections 1158-1165 of the Corporation Tax Act 2010. The Board of abrdn Private Equity Opportunities Trust plc is independent of abrdn plc and Phoenix Group Holdings.

The Company intends to release regular estimated NAV updates around ten business days after each month end. A breakdown of APEO's portfolio can be obtained in the latest monthly factsheet, which is published on APEO's website at:

www.abrdnpeot.co.uk

---

[i] Outstanding commitments less cash and cash equivalents and undrawn loan facilities divided by estimated net assets.

 

END