Introducing a well-defined buyback policy
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Edison Investment Research Limited
London, UK, 29 April 2024
Edison issues review on Princess Private Equity Holding (PEY): Introducing a well-defined buyback policy Princess Private Equity Holding’s (PEY’s) 12-month NAV total return (TR) to end-February 2024 was a modest 0.6% amid low exit activity across private equity (PE) markets. That said, if the pick-up in global M&A volumes witnessed earlier in 2024 continues, it should support PEY’s exit activity. This in turn would translate into improved returns if PEY delivers sizeable uplifts to previous carrying values upon exits, as it has done historically. In this context, we note that PEY has a good pipeline of mature investments that are potentially ripe for sale. PEY’s shares now trade at a 24% discount to NAV versus a 10-year average of 18%. PEY offers a solid annual dividend payment of 5% of opening NAV, which it has been able to successfully deliver since 2021 with few exceptions. Furthermore, PEY’s board recently introduced a well-structured framework for conducting NAV-accretive buybacks. This is designed to ensure a significant part of PEY’s free cash flow will be allocated to share repurchases in the event its shares trade at a wide discount to NAV. In this context, we highlight PEY’s good balance sheet headroom, with available liquidity and contracted exit proceeds exceeding all its outstanding investment commitments. Click here to view the full report. All reports published by Edison are available to download free of charge from its website About Edison: As a content-led investor-relations business, Edison helps companies stand out and meet the right shareholders. Edison’s integrated investor relations solution combines expert analyst content, digital targeting and active investor engagement. This drives liquidity and valuations by building bigger, better informed and more engaged investor audiences globally. Edison has a proven history of increasing liquidity and valuations for its clients. Edison’s content can be viewed by all investors, anywhere in the world. Edison is authorised and regulated by the Financial Conduct Authority. Edison is not an adviser or broker-dealer and does not provide investment advice. Edison’s reports are not solicitations to buy or sell any securities. For more information, please contact Edison: Milosz Papst +44 (0)20 3077 5700 investmenttrusts@edisongroup.com Learn more at www.edisongroup.com and connect with Edison on: LinkedIn https://www.linkedin.com/company/edison-group-/ X www.twitter.com/Edison_Inv_Res YouTube http://www.youtube.com/edisonitv
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1891823 29-Apr-2024
