Aureos Capital, a private equity fund management company focused on emerging markets, says it has seen a rapid acceleration in the number of full exits achieved from its first generation funds during 2010 compared with previous years.
Speaking at the ninth Annual Aureos Investor Conference held at the Marriott Hotel in London this week, Aureos Advisers’ chief executive Sev Vettivetpillai told the 200 plus delegates that eight full exits have been achieved from Aureos’ funds so far during 2010, compared with only one full exit in the previous year.
A further two partial exits have also been executed this year.
“Clearly we do not expect another eightfold increase in the number of full exits next year because exits were particularly thin on the ground in 2009 in the aftermath of the credit crunch,” said Vettivetpillai. “However, we expect to complete some more full exits before the end of the year and continue with a very healthy number in 2011. We are receiving lots of enquiries from potential buyers of companies in our portfolios. We are also very active in seeking new deals for our second generation funds.”
The average internal rate of return achieved for the full exits was 30 per cent and the cash multiples achieved averaged 2.2x. For example, the IRR on the full exit from Voltic, a West African mineral water company, was 55 per cent. A partial exit from Pancake House, a Philippines restaurant chain, achieved an IRR of 84 per cent and a partial exit from C & I Leasing in West Africa achieved an IRR of 306 per cent.
“These exits, combined with the performance of other companies in our portfolios, are testament to our approach, which we call private equity plus,” said Vettivetpillai. “We combine elements of the best in private equity practice with a local, entrepreneurial and personal touch. This is an approach which has enabled us to deliver a positive impact on our investments in what some would find the challenging environment of emerging markets.”
