ICG Enterprise hits £100m milestone after Minimax sale

ICG Enterprise (ICG ) has hit £100m of realisations after the sale of fire safety solutions group Minimax.

The £1.2bn portfolio, which invests in private companies via funds and direct holdings, has announced the sale of Minimax, a provider of industrial and commercial fire protection solutions.

The sale generates cash proceeds of €53m (£45m), in line with the last reported net asset value (NAV).

Minimax was added to the portfolio in 2018 and made up ICG’s largest exposure at the end of October, accounting for 3.3% of the fund.

ICG managers Oliver Gardey and Colm Walsh said the sale of Minimax takes realisations in April to over £100m of total proceeds, all of which ‘will be deployed in line with our investment objectives and capital allocation policy’.

They said the transactions underline the benefits of active portfolio management and ‘help validate the quality of the businesses we invest’, while underpinning long-term returns for shareholders.

The fund is a top performer in its private equity fund of funds sector over the past year, growing its NAV by 6.5%, although its shares are 4.2% lower over the period. This has left the trust on a substantial 41% discount.

Gardey and Walsh said their portfolio of mid-market companies spread across North America and Europe display ‘defensive growth characteristics’ that give shareholders ‘exposure to an attractive segment of the private equity landscape’.

‘We will continue to monitor the macroeconomic environment closely and look forward to discussing our performance and outlook with shareholders in our full year results in early May,’ they said.

At the beginning of the month, ICG sold eight mature primary fund investments for £62m but at a 5.5% discount to the September valuation. Offloading funds into the secondary market allows the manager to recycle proceeds into more attractive opportunities.

Deutsche Numis analyst Gavin Trodd said it was positive to see the fund making further realisations ‘around the valuation’, improving its balance sheet.

He estimated the fund had liquidity of £202m – or 16% of net assets – split equally between cash and undrawn debt.

‘The disposal represents another good example of capital discipline by the manager, with the stronger balance sheet helping to continue to support an active buyback programme, which should limit the downside to the 40% discount.

‘We believe this to be exceptionally cheap for a high quality, diversified portfolio,’ said Trodd.