December 9, 2016 / 10:52 AM / 3 years ago

Electra posts bumper returns ahead of split from Epiris

LONDON (Reuters) - British buyout fund Electra Private Equity reported strong full-year returns on Friday as it prepares to cut ties with its portfolio manager Epiris.

Electra said it made a return of 35 percent in diluted net asset value (NAV) per share for the year ended Sept. 30, boosted by an investment return of 46 percent on its opening portfolio.

The firm is in the midst of trying to separate from its investment management team, which renamed itself Epiris on Monday, as part of a major shake up.

The split, announced following a review in May, came after activist investor Edward Bramson fought a long and bitter campaign to join the listed company’s board as part of a drive to overhaul one of Britain’s oldest private equity firms.

Bramson had criticised Epiris for a lack of openness and said there was more value to be found in the firm’s portfolio, which includes restaurant chain TGI Fridays in Britain.

Electra said it would review its portfolio in the second phase of a major review but it was unlikely to be able to do that until after June 2017, once Epiris’s contract as portfolio manager ends.

“We are eager to embark on the second stage of our review, though the timing of that is currently constrained by the terms of the outsourced management contract and will be after June 2017, unless we are able to negotiate earlier access to the portfolio companies with Epiris, which currently seems unlikely,” Electra Chairman Neil Johnson said.

According to the strategy outlined in the statement, Electra has yet to develop its own investment team.

In the year to Sept. 30, Electra invested 218 million pounds ($275 million) including 137 million pounds across the buyout and co-investments portfolio and 62 million pounds across the debt portfolio.

Electra’s shares rose 1.6 percent to 4,672 pence following the results release.

($1 = 0.7925 pounds)

Reporting by Dasha Afanasieva in London and Noor Zainab Hussain in Bengaluru; editing by David Clarke

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