HgCapital has sold a minority interest in UK business services provider JLA to a group of institutional investors. Following completion of this transaction, HgCapital, the manager of HgCapital Trust, will retain around 62% of the equity in the company on behalf of its HgCapital 6 fund clients, including the Trust.
In addition, the business has been re-financed. HgCapital Trust will realise cash proceeds of around £17.3 million on completion of the sale and refinancing. In October 2014 the Trust received £4.5 million from a previous refinancing.
Acquired by HgCapital in March 2010, JLA provides commercial laundry and catering equipment, and ancillary offerings, on a contracted basis. JLA operates across a diverse sector base offering customers a fully inclusive machine supply and service proposition under the name of Total Care.
So far the investment has generated 3.5x capital invested over JLA’s holding period. The total value of cash proceeds and the retained stake for the Trust’s investment (£20.4 million) compares to a carrying value of £27.4 million in the Net Asset Value of the Trust at 30 September 2015, which was based on the Directors' valuation as at 30 June 2015. This represents an uplift of £10.3 million (37%) or 27 pence per share.