Candover says tough LBO climate to persist

LONDON (Reuters) - Private equity firm Candover Investments said a difficult climate for selling businesses is entering its second year.

"This is a good time to invest with company valuations and debt multiples back to more sensible levels. Realisations, however, will be harder to achieve," Chairman Gerry Grimstone said in a statement on Wednesday.

As early as a year ago Grimstone said realisations were becoming more difficult to accomplish due to jittery markets.

The firm, whose largest investments are in engineering conglomerate Stork VMFN.AS and luxury yacht maker Ferretti, said net assets per share in the six months to June 30 had stayed broadly flat on the previous six months and grew 11 percent over the 12 months to June 30.

That compares with declines in the FTSE All Share Index over the same periods, Candover said.

Candover (CDI.L) invested 3.8 million pounds in bookmaking, casino and bingo firm Gala Coral, alongside 30.1 million pounds provided by the 2001 Fund, as part of a refinancing.

Net assets per share were 2,051 pence and incorporated favourable currency movements of 87 pence per share and provisions against investments of 68 pence per share.

The firm has set up Asian and Eastern European teams to focus on opportunities in those regions, with an office in Hong Kong already open and another opening shortly in Mumbai.

The pan-European buyout team expanded to 43 investment executives.

Candover 2008 Fund held its first closing in August with total commitments of 2.8 billion euros. Candover committed 1 billion euros to the fund.

Private equity firms exit from investments either by selling to another private equity firm, public markets or corporate buyers.

Candover shares were flat at 2,116 pence at 0950 GMT.