DBAG posts record earnings

Germany’s oldest private equity firm, Deutsche Beteiligungs, completed its 2004–05 financial year with earnings that set a new high in its 40-year history. Consolidated profit for the year, measured by the IFRS format for the first time, reached €41.3m, up from €10m the year before. DBAG also closed its new fund, DBAG Fund V, last week with 26 investors committing to invest €434m.

The firm’s post-tax return on equity amounts to 18.1%, which is distinctly over the S-Dax average of 50 companies. Net asset value per share climbed by €2.10 to €14.65 in 2005–06, an increases of 16.7%, and the firm’s share price rose by 34%.

Deutsche Beteiligungs said it would no longer invest in minority stakes, nor commit capital to international buyout funds.

“From now on, we intend to concentrate on what we do best and what promises to create the greatest earnings opportunities – management buyouts in Germany, majority investments in mid-sized, well-poised industrial companies and industry-related service providers,” said Wilken von Hodenberg, spokesman of the executive board.

Deutsche Beteiligungs made two acquisitions in 2004–05 and sold seven investments from its portfolio.

The company invested €7.7m in the purchase of the Clyde Bergemann group, a manufacturer of soot blowers and ash handling solutions for coal-fired power plants. It also supported the MBO of Lewa, investing €4.1m in this manufacturer of diaphragm pumps and pump systems.

Among the divestments were Babcock Borsig Service, Schlott Gruppe and Unternehmens Invest. In late December, the company realised its investment in Otto Sauer Achsenfabrik.