SVG Capital, the UK private equity group, has proposed winding down the company and selling half of its investment portfolio to rival fund managers Pomona Capital and Pantheon Ventures.
SVG rejected an unsolicited £1bn takeover offer from US fund manager HarbourVest last month but is under pressure from shareholders who support the bid.
Management presented an alternative plan on Tuesday, saying that SVG had agreed to sell Pomona and Pantheon 50 per cent of its investment portfolio for £379m, which had an asset value of £401m at July 31. The price represents a 7.8 per cent discount on a constant currency basis.
The portfolio included “mature and non-mature assets”, it said, including stakes in funds managed by Cinven and Clayton Dubilier & Rice.
SVG said the deal would be followed by a proposed wind down of the company through a £450m tender offer before year-end at 700p per share — a 5 per cent discount to its stated net asset value — and a further £300m tender offer at prevailing net asset value early in 2017. Further tender offers would be made as investments were sold, it said.
The SVG board said that it “believes the wind down of the company will maximise returns for shareholders”, compared with an “existing 650p a share cash offer from HarbourVest”.
At the time, Boston-based HarbourVest, which has $42bn under management, said its offer was “final”.
SVG chief executive Lynn Fordham has said that HarbourVest’s offer undervalues the company.
SVG’s largest shareholder, Coller Capital, has irrevocably backed HarbourVest’s bid, and HarbourVest recently bought an 8.5 per cent stake in SVG. Other shareholders with a combined 22.7 per cent stake, including Aviva, Old Mutual and Legal & General have signed non-binding letters of intent to back the bid.
The statement comes just one day after SVG said that Goldman Sachs and Canada Pension Plan Investment Board were considering a joint bid for the private equity group.
Earlier on Tuesday, HarbourVest urged investors to accept its offer, saying it “provides shareholders with clarity and certainty”.