INTERIM MANAGEMENT STATEMENT
SVG Diamond Private Equity III plc ("SVG Diamond III" or the "Fund")
17 August 2012
This interim management statement has been prepared in accordance with the EU Transparency Directive and relates to the period from 1 April 2012 to 17 August 2012.
SVG Diamond Private Equity III plc is a €600.0 million closed-ended investment company. It is designed to deliver investment returns by using a combination of debt and equity to fund commitments to private equity and mezzanine funds. The capital structure comprises €320.0 million of debt provided (subject to compliance with various covenants) by a long term senior revolving credit facility and €280.0 million of callable equity. At 31 July 2012, €286.6 million of debt was drawn down (89.6%) and €201.6 million (72.0%) of equity was called.
The investment objective of the Fund is to earn superior returns through investments in private equity fund investments and/or cash equivalent investments.
The audited report and accounts for the 12 months ending 31 March 2012 were published in
July 2012. The Fund's unaudited interim report and accounts for the six months ending
30 September 2012 will be published in November 2012.
Commitments and portfolio value
The Fund has not entered into any new commitments since 2008 and in November 2011, SVG Advisers took the decision that no further commitments will be recommended to the Fund.
At 31 July 2012, unfunded commitments totalled €99.0 million and the portfolio was valued at €405.5 million.
In the period, distributions of €20.7 million1 have been received and calls of €15.9 million1 were paid.
At 31 July 2012 cash balances stood at €16.9 million and the Fund's €320.0 million bank line was 89.6% drawn.
SVG Diamond III was due to issue a 5% mandatory equity call at the end of June 2012.
SVG Advisers sought approval from the Fund's majority lender, Lloyds TSB Bank plc, to defer the mandatory equity call until 31 July 2013. This was agreed at no additional cost.
We believe this is a favourable outcome for the Fund and its investors. SVG Diamond III has called 72% of equity in aggregate. The timing and quantum of the next equity call will be driven by
events in the markets and their potential impact on the Fund's loan to value covenants and its liquidity position, in particular the available borrowing capacity which is dependent upon inter alia, portfolio distributions, €:US$ exchange rate and total portfolio value. SVG Advisers is proactively monitoring events and will aim to communicate as early as possible if an equity call is expected to be issued prior to the mandatory call on 31 July 2013.
All financial information as at 31 July 2012, unless otherwise stated.
This statement aims to give an indication of material events and transactions that have taken place during the period from 1 April 2012 to 31 July 2012 and their impact on our financial position. These indications reflect our current view. They are subject to a number of risks and uncertainties and could change. Factors which could cause or contribute to such differences include, but are not limited to, general economic and market conditions and specific factors affecting the financial prospects or performance of individual investments within our portfolio.
1 Translated at transaction FX rates