Hg Capital Share Discussion Threads

[mrscruff] 21/1/2021 12:14

Was the NAV not adjusted down post C19 like it was for HVPE? This then got revised upwards in December when the proper revaluation is done for HVPE. My other funds are the same like Draper Esprit. If not no worries. I was told that valuations of listed does factor a little in these valuations not quality but yearly. Back to my sound thinking being assumptions then!!!

[makinbuks] 20/1/2021 12:25

So the graph shows one year performance of the index +40% compared to Hg +22% and your hypothesis is that Hg will increase its NAV to catch up, is that right? I hope you're right and certainly its an encouraging stat, but here's some thoughts: 1.Hg calculates its NAV bottom up driven more by individual performance in Revenue and EBITA terms than perceived market value. 2.None of Hg's companies are in the index so it doesn't follow necessarily that they will behave like them 3. PE's tend to value conservatively compared to market trends. This is so that they can show a profit on disposal. Better to keep gaining a little every time you value than to saw tooth up and down

[tykethat] 20/1/2021 12:17

As usual when my monthly buy order goes in the price goes up! HGT are a genuine high quality outfit whose long term record is very good.

[makinbuks] 18/1/2021 23:14

Thanks MrScruff, you make some good points and by the way I hold HarbourVest, Apax Partners and Oakley as my exposure to the PE sector as well as HG. I'm with you on considering HG less as a PE fund and more of a SAAS company. Indeed it would be interesting to see their consolidated results on an IFRS basis as if that were the case. Of course they are not a group and do not behave as such, either in terms of cross selling or cost synergies. I guess they're a hybrid in that they are actively driving, or at least influencing, strategy but not in operational control Its interesting that former stock market darlings such as Hanson were conglomerates and now very much out of fashion. Yet were they so different? They DID of course produce consolidated accounts and did not publish a NAV but in many ways they were just investment vehicles benefiting from leverage. They were sometimes criticised for the degree of leverage they took on but it was nothing compared to a PE fund

[mrscruff] 18/1/2021 21:09

Makinbuks your not on your own now and yes we need to trust them. With private equity you are really buying into the company HG. Just like you would with HarbourVest. Both have strong track records with HG in London and HarbourVest in the US. The fees are there because private equity actively participate in the running of the business even after the intensive due diligence. In a way both can't be looked at like a fund like BMO Private Equity or Pantheon who tend to simply buy a fund. This is more like a Microsoft or Google who own lots of companies. The listed SAAS sector has risen strongly. Europe stocks have rallied. HGT will catch up on performance chasing alone. I suspect as much as 20 percent before H2 presuming equity markets remain strong.

[makinbuks] 18/1/2021 16:38

Appreciate I'm talking to myself here but todays announcement is also somewhat questionable. If I read it correctly, they sold this business some time ago to another PE house but retained a minority stake. Now that other PE manager is selling it internally between his funds at a price which is greater than our last valuation (but so what? We're not receiving any cash) and we have increase our stake at that higher price, again through a later vehicle within our structure. You could go on like this for years convincing yourselves this business is worth more and more and indeed it might be, but as we can't see any actual numbers we have to take it on trust. A lot of fees racking up through all this churn

[makinbuks] 05/10/2020 14:55

Again, is it a little incestuous? They sell A Plan to Hyperion, trumpet it as a great deal having recognised fantastic returns. They then "churn the sale proceeds into Hyperion at an undisclosed price. I agree they don't seem to put a foot wrong and I also hold a (for me) decent amount but these last two deals don't sit quite right with me

[robsy2] 30/9/2020 10:45

looks good to me in that they don't really seem to put a foot wrong.

[lasata] 29/9/2020 17:29

Is this bullish news for HTG? NS Number : 4973A HgCapital Trust PLC 29 September 2020 Hg, the Manager of HgCapital Trust plc ("HGT"), today announces an investment in Hyperion Insurance Group Limited ("Hyperion"), the international insurance intermediary. The full terms of the transaction are not disclosed. HgCapital Trust plc will invest approximately GBP33.1 million in Hyperion, with other institutional clients of Hg investing alongside HGT through the Hg Saturn 2 Fund. HGT, whose shares are listed on the London Stock Exchange, gives private and institutional investors the opportunity to participate in all Hg's investments. Note that these figures only relate to HGT's share of Hg's overall investment in Hyperion. HGT's liquid resources available for future deployment (including all announced transactions and the interim dividend payable in October 2020) are estimated to be GBP278 million (24% of the 31 August 2020 pro-forma NAV of GBP1.16 billion, including the increase in equity via tap equity issues over the third quarter of 2020). The investment will reduce HGT's outstanding commitments to invest in Hg transactions to approximately GBP759 million. Hg invests in Hyperion in a transaction valued at US$5 billion Transaction and debt raise will provide up to $1.5bn to accelerate strategic growth and Hyperion's focus on technology and data London, UK. 29(th) September, 2020 - Hg, a leading European investor in software and tech-enabled services businesses, today announces that it will make a significant long-term equity investment in Hyperion Insurance Group Limited ("Hyperion"), the international insurance intermediary. The transaction values the business at an enterprise value of around US$5 billion. In conjunction with an additional debt raise and existing resources, the investment will provide Hyperion with up to $1.5bn to accelerate its growth with both selective acquisitions and investments in data and technology. Hg will join Hyperion as an aligned, long-term, growth partner alongside General Atlantic, which invested in Hyperion in 2013, and CDPQ, which invested in Hyperion in 2018. Both General Atlantic and CDPQ remain committed to being partners of Hyperion alongside Hg. The Hyperion management team and employees will remain the largest shareholder group in the company, with more than 1,000 individuals now owning shares. The transaction establishes a sustainable, long-term capital model with core employee ownership supported by collaborative investment partners, enabling Hyperion to build out Howden as a leading international challenger broker and DUAL as an international specialist MGA. The full terms of the transaction are not disclosed and closing is subject to obtaining relevant regulatory approvals. Founded in 1994 and headquartered in London, Hyperion is a leading international insurance distribution group. Through its core activities of retail, speciality & reinsurance broking and through DUAL, one of the world's leading international MGAs, it facilitates the provision of B2B insurance across a wide geographic footprint. The Group operates across 200+ global offices in 40 countries and employs c.6,000 people to manage c. $9.0 billion of Gross Written Premium ("GWP") on behalf of its clients. It is the 5(th) largest employee-owned business in the UK and has a differentiated position as a leading international insurance intermediary. The investment continues Hg's focus on insurance distribution and insuretech. Hyperion will represent Hg's sixth investment in the wider sector over the last 5 years - with these businesses together totalling over $1 billion of invested client capital. Hyperion's broking arm, Howden, recently announced it had reached agreement to acquire A-Plan Group from Hg. Hg helped to drive a focus on embedding data and technology in A-Plan Group's best-in-class service model over its investment period. This experience in technology will also benefit Hyperion X, the Group's digital, data and analytics business. David Howden, Chief Executive Officer of Hyperion, said: "I am thrilled to welcome Hg as a long-term partner. During our conversations on A-Plan Group it was clear that Hg and Hyperion share an understanding of what building a business to last means for employees and clients. This, the quality of the Hg team, their support for our core employee ownership and our culture of empowerment, and the desire of the Hg partners to contribute to our digital and data strategy, makes them an excellent partner to join General Atlantic and CDPQ as we continue our journey." Andrew Land, Partner at Hg, said: "It is a privilege for Hg to back David and his fantastic team through this investment in Hyperion. The company is a unique and special business, driven by its outstanding culture and quality of talent, and it has a significant growth opportunity across the global insurance sector in the coming years. We got to know David during the recent sale by Hg of A-Plan Group to Hyperion, and it became clear that our long-term investment approach and specialism in technology were a great match for him and his team. In addition to providing capital, Hg's deep knowledge of software and data will help Hyperion stay at the forefront of technology adoption across the insurance sector." Nic Humphries, Senior Partner at Hg, said: "This long-term investment in Hyperion reflects Hg Saturn's strategy of backing entrepreneur-led growth businesses in software and tech-enabled services that are sector champions. In Saturn's recent investments in Visma, P&I, Argus Media, Sovos and now Hyperion, we developed a trusted relationship with the founder or CEO over a long period, enabling us to offer them the investment structure they needed to meet their long-term plans. David and his team have built one of the global leaders in insurance distribution and we are excited in supporting them for many years to come." Dominic Collins, Chairman of Hyperion, said: "I am delighted that Hg have chosen to become a partner alongside General Atlantic and CDPQ. It is a privilege to work with three partners who embrace our core ambition to build a sustainable and successful business, and who will help us to deliver on our strategy over the coming years at this very exciting time in the industry. The Hg team bring not only significant capital, but also considerable expertise and I look forward to welcoming them to the Board."

[makinbuks] 23/9/2020 14:12

Is this sell to another PE House and then reinvest a few months later at a higher valuation not a bit dodgy?

[games] 15/9/2020 10:14

hTTps://masterinvestor.co.uk/funds-and-investment-trusts/hgcapital-trust-strong-performance-from-a-portfolio-of-unlisted-tech-companies/

[lasata] 14/9/2020 10:38

Agree and chart breakout very positive too Good times ahead

[makinbuks] 14/9/2020 09:20

Positive and punchy

[tykethat] 14/9/2020 09:04

Pleased to see NAV back above the share price! I don't like premia!

[games] 14/9/2020 07:22

Decent update. With some caution.

[skyship] 23/8/2020 13:45

Nice play Andy - well done indeed. Very tempted to short this - to trade at an NAV premium is totally crazy...

[andyj] 22/8/2020 10:31

I took profits yesterday. Probably too early but happy to take 30% profits in the current situation and sit on cash. It looks a bit spikey.

[games] 21/8/2020 07:00

Decent uplift to nav due to Visma. A little concerned that Visma is such a high percentage of hg, but as the saying goes, let your winners run.

[technovator] 13/5/2020 08:29

I see HGT is still defying gravity with it's non-independent valuations of it's unlisted holdings. Reminds me some of Neil Woodford's funds! GLG opened a short over the last couple of weeks.

[andyj] 16/4/2020 06:08

I agree, but I cannot see that price being reached as much as I hope it is.

[scorpio51] 02/4/2020 15:12

One of the highest quality pe trusts. I would wait until it retests lows around 165p before buying/topping up.

[rambutan2] 15/3/2020 03:19

Even HGT can't defy gravity: Our valuation policy is applied consistently, in accordance with the IPEV Valuation Guidelines. Each company has been valued individually, based on the trading multiples of comparable businesses and relevant and recent M&A activity; this resulted in an average EBITDA multiple for the top 20 buyout investments of 19.8x (19.5x at 30 June 2019). hTtps://www.hgcapitaltrust.com/~/media/Files/H/Hgcapital-Trust/reports-and-presentations/2020/report-and-accounts-annual-2019.pdf

[steve c1] 13/3/2020 16:44

Anyone know whay happened to justify such a drop? Thought this might hold up better than most especially after recent results.