French private equity firm Siparex is planning to change the way its listed private equity vehicle, Siparex Croissance, is managed. The change in strategy will make Siparex Croissance’s management comparable to that of private equity investment funds listed on the stock market with a view to optimizing liquidity and the yield on shares for shareholders.
The main changes will include shortening Siparex Croissance’s term to 10 years, which is the typical life of a French FCPR venture capital fund. This 10-year period will be divided into two parts: an initial period during which Siparex Croissance may invest undistributed cash, and a second period during which Siparex Croissance will cease to make new investments (other than follow-on investments) and will liquidate its portfolio.
The fund, which floated in 1991, will make annual distributions to shareholders of the cash generated by revenues from the portfolio and the proceeds of exits (less amounts
invested) through the distribution of dividends and public share buy-back offers.
The shareholders’ meeting scheduled for 31 May 2005 will be asked to approve this change.
Siparex Croissance acquires minority shareholding interests in medium-sized unlisted companies, mainly in the South East of France. The IRR on total and partial exits since the group was founded 26 years ago was 16.3% at 30 June 2004.
Sigefi Private Equity, the management company of the entire Siparex Group has also launched a new development capital/LBO fund, Siparex Mid Cap, which will co-invest with Siparex Croissance. The fund has a target of €120m and has already received commitments amounting to half its target from Siparex Associés.