February 5, 2020 / 5:57 AM / 19 days ago

Bahrain's Investcorp half-year earnings drop, assets rise to $31.1 billion

DUBAI (Reuters) - Bahrain-based investment firm Investcorp INVB.BH said its net profit dropped 17% in the six months ending Dec. 31, mainly due to a decline in fair value of private equity investments in the U.S. retail sector and a writedown on a legacy telecom asset.

Investcorp reported a net profit of $47.6 million, down from $58.2 million in the same period a year earlier.

Investcorp’s sale of U.S. TelePacific Holdings Corp, or TPx Communications, last year was a legacy investment it had kept for over two decades, Investcorp Chief Financial Officer Jan Erik Back said on an earnings call.

The deal is pending regulatory approval in the United States, which could come “relatively soon”, he said.

“It’s a firm that was acquired some twenty years ago and it’s obviously something that’s very out of the ordinary for us to keep as an investment on the balance sheet for that long,” he said, adding a normal holding period is five years.

Siris Capital Group, a private equity firm, last year agreed to buy TPx Communications from investors including affiliates of Investcorp and Clarity Partners.

Investcorp’s total assets grew by $3 billion to $31.1 billion, as the firm moves towards a medium-term target of hitting $50 billion in assets under management.

Late last year, Investcorp joined forces with Chinese partners to spend up to $500 million buying food brands and manufacturing sites in Asia, aiming to tap into China’s emerging middle class and its growing taste for foreign food.

Last month, Investcorp announced it had raised $130 million for funding real estate projects in India.

“There will be more coming out of China and India,” Back said.

Reporting by Saeed Azhar, editing by Davide Barbuscia and David Evans

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