SVG Capital PLC - Bond launch & sale of assets

Thu May 8, 2008 2:01am EDT

* Reuters is not responsible for the content in this press release.

RNS Number:9483T
SVG Capital PLC
08 May 2008

For immediate release 7.00am 8 May 2008

SVG Capital strengthens balance sheet ahead of new investment opportunities

Launch of Convertible Bond and Sale of Assets

The Board of SVG Capital today announces the launch of a convertible bond
offering of £100 million1 and the signing of agreements for the sale of a
portfolio of private equity fund interests representing 6.9% of net assets2 at
31 December 2007.

The proceeds of these transactions, together with the recently announced
realisations of debitel and Parkway, both of which were sold at a premium to net
asset value, will strengthen SVG Capital's balance sheet and liquidity position
and give the Company greater flexibility to take advantage of opportunities
arising from the launch of new private equity funds, including investment
vehicles launched by SVG Advisers, and for general corporate purposes.

Convertible bond offering

SVG Capital is launching an offering of £100 million in principal amount of
convertible bonds (the "Bonds") targeting institutional investors outside of the
US. The Bonds will be subordinated to the Company's Senior Notes and bank lines,
convertible into the Ordinary Shares of the Company and will have a maturity of
2016. The conversion price will be 1000p, which represents a premium to the 31
December 2007 net asset value of 974.3p3.

The Company has appointed JPMorgan Cazenove as bookrunner of the Bond issue with
Key Capital and The Royal Bank of Scotland acting as co-lead managers. Closing
of the issue will be subject to satisfaction of customary conditions contained
in the Underwriting Agreement expected to be entered into today following
determination of the final terms of the offering. Key Capital acted as Financial
Adviser to SVG Capital in relation to the Bond issue.

Sale of secondary portfolio of fund interests

The portfolio of private equity fund interests comprises a range of interests
that includes mature and non-core assets. The agreed purchase price for the
portfolio is £102.4 million4 which compares to a 31 December 2007 net asset
value of the fund interests of £100.3 million5.  In the local currency of the
underlying fund interests the purchase price paid, after adjusting for material
realisations and movements in the value of the quoted portfolio, was
approximately in-line with 31 December 2007 valuations. The purchase price will
be updated at closing to reflect any cash flows associated with the assets.

Following the sale of these fund interests, SVG Capital's core investments and
commitments remain focused on Permira funds, which continue to represent 89% of
SVG Capital's private equity portfolio.

The portfolio of fund interests agreed to be sold are summarised below:

Fund                                           Vintage Year     % of holding
SV Life Sciences Fund II                               1999           100.0%
SV Investments Fund I                                  1999            25.0%
Permira Europe II                                      2000           *21.4%
SV Life Sciences Fund III                              2002            80.0%
Permira Europe III                                     2003           *10.4%
Permira IV                                             2006            *1.7%

* total holdings include holdings through feeder vehicles advised by SVG

Two separate sale agreements have been entered into. The purchasers of the fund
interests are Lexington Partners, the world's largest independent buyer of
secondary interests in private equity funds,   which has conditionally agreed to
acquire 80% of the fund interests being sold for £81.6 million, and SVG Diamond
Private Equity Holdings III Limited, which has conditionally agreed to acquire
20% of the fund interests being sold for £20.8 million, in each case subject to
adjustments as described above.  Completion of these transactions is conditional
upon certain consents being obtained from the general partners of the funds in
question and is expected to occur in the fourth quarter of 2008.

Nicholas Ferguson, Chairman of SVG Capital commented: "We believe that the
current market environment will produce a number of interesting investment
opportunities which will have the potential to provide superior returns for SVG
Capital and its shareholders over time, and have taken the opportunity to
further strengthen our balance sheet ahead of this."

This announcement does not constitute or form part of an offer to sell or the
solicitation of an offer to subscribe for or otherwise acquire any securities.
The securities have not been and will not be registered under the U.S.
Securities Act of 1933 and are subject to U.S. tax law requirements.
Accordingly, these securities may not be offered, sold or delivered in the
United States or to U.S. persons.


For further information, please contact:

SVG Capital plc                                 020 7010 8900
Nicholas Ferguson/Andrew Williams/Alice Kain

Penrose Financial                               020 7786 4888
Andrew Nicolls/Alex Clelland/Francesca Reville

1 Subject to upsize (maximum underlying shares = 10% of the outstanding shares)

2 Including the Directors' 31 December 2007 unaudited valuation of SVG Advisers
  and adjusting for cash flow since then

3 Including the Directors' 31 December 2007 unaudited valuation of SVG Advisers

4 Prior to adjusting for any cash flows associated with the assets since 31
  December 2007

5 This differs from the 31 December 2007 General Partners' reported value, which
  may discount quoted stocks as the General Partners do not report under IFRS

This press release is for information only and does not constitute an offer to
sell, subscribe, purchase, exchange or transfer any securities or a solicitation
of any such offer. This communication is directed only at persons who (i) are
outside the United Kingdom or (ii) have professional experience in matters
relating to investments or (iii) are persons falling within Article 49 (2((a) to
(d) ("high net worth companies, unincorporated associations etc") of The
Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (all
such persons together being referred to as "relevant persons"). This
communication must not be acted on or relied on by persons who are not relevant
persons. Any investment or investment activity to which this communication
relates is available only to relevant persons and will be engaged in only with
relevant persons.

                      This information is provided by RNS
            The company news service from the London Stock Exchange