European Capital Reports euro 0.90 NOI and euro 0.95 Realised Earnings in 2007
St. Peter Port, Guernsey (ots/PRNewswire)
- Forecasts 68% Dividend Increase in 2008 to euro 0.62
- Forecasts Q1 Dividend of euro 0.15
European Capital Limited ("European Capital") (LSE: ECAS)
announced today its results for the fourth quarter and full year of
2007.2007 RESULTS
European Capital announced today its results for the quarter and
year ended 31 December 2007. Net Operating Income ("NOI") for the
year increased 109% to euro 0.90 per share, compared to euro 0.43 per
share for 2006. For the quarter, NOI increased 29% to euro 0.27 per
share, compared to euro 0.21 per share in the fourth quarter of 2006."European Capital had a strong 2007 and is in an excellent position to have superior performance in 2008," said Malon Wilkus, European Capital Chairman. "However, the market has dramatically priced down financial stocks, and European Capital, being a young company, has experienced more than its share of these declines. We and our Investment Manager could not be more focused on this issue. We are reviewing all our options with respect to our extremely low price to book value and we will do all we can to see it rise in 2008."
Earnings less appreciation and depreciation ("Realised
Earnings"), increased 121% to euro 0.95 per share for 2007, compared
to euro 0.43 per share for 2006. For the quarter, Realised Earnings
increased 23% to euro 0.27 per share, compared to euro 0.22 per share
for the fourth quarter of 2006. Realised Earnings return on equity at
cost for 2007 was 10%. 2007 Realised Earnings exceeded 2007 total
dividends by 64%.Earnings increased 31% to euro 0.68 per share for 2007, compared to euro 0.52 per share for 2006. For the quarter, Earnings decreased 69% to euro 0.09 per share, compared to euro 0.29 per share for the fourth quarter of 2006. Earnings return on equity for 2007 was 7%.
As previously announced, fourth quarter 2007 dividends were euro 0.14 per share. For the quarter, European Capital's Realised Earnings of euro 0.27 per basic share exceeded the dividend by 93%.
European Capital's net asset value ("NAV") per share at 31
December 2007 was euro 9.67, a euro 0.06 decrease, including dividend
distributions of euro 0.37 per share, from the 10 May 2007 IPO NAV
per share of euro 9.73. The 31 December 2007 NAV was euro 0.04 per
share less than at the end of the prior quarter."The credit quality of our portfolio is excellent and we believe that the performance of European Capital's portfolio remains very strong," said John Erickson, Director of European Capital Financial Services (Guernsey) Limited, European Capital's Investment Manager. "Delinquencies and non-accruing loans are at a low level of 1.9% of the portfolio at cost. Commercial credit quality remains outstanding, spreads have widened, and many of our highly geared competitors are experiencing difficulty raising capital. With euro 2.3 billion of capital resources, we continue to have access to capital, permitting us to meet continued mid-market demand. Subsequent to our IPO in May 2007 we raised an unsecured multicurrency revolving line of credit in August 2007, a time when access to capital was closed to many financial institutions. Our ability to raise capital in this environment is also an ongoing affirmation of our business model, the outstanding quality of the Investment Manager's investment team and the portfolio."
For the year, European Capital invested euro 1.6 billion and received euro 0.7 billion of proceeds from realisations of portfolio investments. In the fourth quarter of 2007, European Capital invested euro 180 million and received euro 112 million of proceeds from realisations of portfolio investments.
The weighted average effective interest rate on European Capital's total investments in debt securities at 31 December 2007 was 12.7%, 50 basis points higher than at 30 September 2007. As of 31 December 2007, loans at cost of euro 30 million in relation to one Portfolio Company, which had been fully depreciated, were on non-accrual. These non-accruing loans represented 1.9% of total loans at cost and 0.0% of total loans at fair value at 31 December 2007.
"European Capital possesses significant competitive advantages as
many of our competitors face a difficult environment in which many
middle market investors are trying to find their way," said Ira
Wagner, President of European Capital Financial Services Limited
("ECFS"). "European Capital's One Stop Buyouts(TM), in which we fund
senior debt, mezzanine debt and equity, have become even more
important to sellers of companies in this uncertain financing
environment. In addition, European Capital's resources and ability to
underwrite mezzanine assets is in great demand from other private
equity funds who are seeking certainty of financing for their
transactions. Financing is going to be much harder to raise for most
private equity funds in the current environment, mezzanine debt is
going to play an increasingly significant role and we are superbly
positioned to take advantage of these market conditions. Although
investment opportunities in the second half of 2007 declined, due to
the significant decline of large multi-billion euro transactions, the
mid-market targeted by our four offices remains active. At the close
of 2007, we were reviewing approximately euro 9 billion of
opportunities. We continue to find mid-market companies with robust
track records, strong cash flows, significant growth prospects,
highly competitive positioning, experienced management teams and the
potential for European Capital to gain liquidity and/or realise
appreciation in its investments. We continue to make progress
increasing our market coverage across Europe, with offices in London,
Paris, Frankfurt and Madrid, and having investments in the U.K.,
Germany, France, Luxembourg, the Netherlands, Sweden, Norway, Spain,
Switzerland and Italy."Since inception European Capital has earned a 15% compounded annual return, including interest, dividends, fees and net gains, on 27 realisations of senior debt, subordinated debt and equity investments, totalling euro 1 billion of invested capital. These realisations represent 34% of all amounts invested by European Capital since inception.
2008 DIVIDEND GUIDANCE
European Capital forecast total 2008 dividends of euro 0.62 per share, a 68% growth over post-IPO 2007 dividends of euro 0.37 per share in 2007. The 2008 dividends per share are forecast to be in the following quarterly amounts:
euro 0.15 for Q1 2008;
euro 0.15 for Q2 2008, 50% increase over Q2 2007;
euro 0.16 for Q3 2008, 23% increase over Q3 2007; and
euro 0.16 for Q4 2008, 14% increase over Q4 2007.THIRD PARTY VALUATION OF PORTFOLIO INVESTMENTS
European Capital's Board of Directors is responsible for
determining the fair value of European Capital's portfolio
investments on a quarterly basis. In that regard, the Board retains
Houlihan Lokey Howard & Zukin Financial Advisors Inc. ("Houlihan
Lokey") to assist it by having Houlihan Lokey regularly review its
fair value determinations. Houlihan Lokey is a leading valuation firm
engaged in approximately 1,000 valuation assignments per year for
clients worldwide. Each quarter, Houlihan Lokey reviews European
Capital's determination of the fair value of all portfolio companies
that have been a portfolio company at least one year and that have a
fair value in excess of euro 10 million. In the fourth quarter of
2007, Houlihan Lokey reviewed valuations of 23 portfolio company
investments having an aggregate euro 741 million in fair value as of
the period end. In addition, Houlihan Lokey representatives attend
European Capital's quarterly valuation meetings and provide periodic
reports and recommendations to the Audit Committee of the Board of
Directors.Financial highlights for the quarter and year are as follows:
EUROPEAN CAPITAL LIMITED
CONSOLIDATED BALANCE SHEETS
As of 31 December 2007 and 2006
(in thousands, except per share data)
31 December 31 December
2007 2006 2007 Versus 2006
euro euro euro %
Assets
Investments at fair value (Cost
basis of euro 1,968,468 and
euro 1,072,938, respectively) 1,925,696 1,077,709 847,987 79%
Cash and cash equivalents 2,575 85,932 (83,357) -97%
Restricted cash 30,214 12,913 17,301 134%
Other 9,558 18,031 (8,473) -47%
Total assets 1,968,043 1,194,585 773,458 65%
Liabilities and Shareholders'
Equity
Debt (maturing within one year
euro 101,061 and euro nil,
respectively) 896,157 422,414 473,743 112%
Due to European Capital
Financial Services (Guernsey)
Limited 718 3,568 (2,850) -80%
Accrued dividends payable 15,171 21,750 (6,579) -30%
Other 8,377 2,699 5,678 210%
Total liabilities 920,423 450,431 469,992 104%
Commitments and contingencies
Shareholders' equity:
Ordinary shares (nil par
value, authorised to issue
unlimited number of shares,
108,364 issued and
outstanding) 1,030,888 - 1,030,888 NM
Preference shares (nil par
value, authorised to issue
unlimited number of shares,
75,000 issued and
outstanding) - 737,696 (737,696) NM
Undistributed net realised
earnings 37,235 1,261 35,974 NM
Net foreign currency
(depreciation)
appreciation (28,391) 332 (28,723) NM
Net appreciation of
investments 7,888 5,638 2,250 40%
Other reserve - (773) 773 100%
Total shareholders'
equity 1,047,620 744,154 303,466 41%
Total liabilities and
shareholders' equity 1,968,043 1,194,585 773,458 65%
NM = Not Meaningful EUROPEAN CAPITAL LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS
Three and Twelve Months Ended 31 December 2007 and 2006
(in thousands, except per share data)
Three Months Ended Three Months Ended
31 December 31 December
2007 2006 2007 Versus 2006
(unaudited)(unaudited)
euro euro euro %
OPERATING INCOME:
Interest and dividend income 55,214 30,039 25,175 84%
Fee and other income 612 6,241 (5,629) -90%
Total operating income 55,826 36,280 19,546 54%
OPERATING EXPENSES:
Interest 14,880 7,135 7,745 109%
Management fee and reimbursed expenses 9,775 11,238 (1,463) -13%
Incentive fee - - - -
General and administrative 1,728 1,935 (207) -11%
Total operating expenses 26,383 20,308 6,075 30%
OPERATING INCOME BEFORE INCOME TAXES 29,443 15,972 13,471 84%
Provision for income taxes (49) (207) 158 76%
NET OPERATING INCOME 29,394 15,765 13,629 86%
Net foreign currency gains (losses) 46 (829) 875 NM
Net gains on investments - 1,345 (1,345) -100%
TOTAL NET REALISED EARNINGS 29,440 16,281 13,159 81%
Net foreign currency (depreciation)
appreciation (13,782) 1,819 (15,601) NM
Net (depreciation) appreciation of
investments (5,950) 3,276 (9,226) NM
INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS ("EARNINGS") 9,708 21,376 (11,668) -55%
NET OPERATING INCOME PER SHARE:
Basic & Diluted 0.27 0.21 0.06 29%
NET REALISED EARNINGS PER SHARE:
Basic & Diluted 0.27 0.22 0.05 23%
NET EARNINGS PER SHARE:
Basic & Diluted 0.09 0.29 (0.20) -69%
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING:
Basic 108,364 75,000 33,364 44%
Diluted 108,364 75,166 33,198 44%
DIVIDENDS DECLARED PER SHARE 0.14 0.29 0.14 NM
Year Ended Year Ended
31 December 31 December
2007 2006 2007 Versus 2006
euro euro euro %
OPERATING INCOME:
Interest and dividend income 174,470 69,943 104,527 149%
Fee and other income 6,715 15,220 (8,505) -56%
Total operating income 181,185 85,163 96,022 113%
OPERATING EXPENSES:
Interest 42,149 16,134 26,015 161%
Management fee and reimbursed expenses 39,459 32,279 7,180 22%
Incentive fee 5,115 - 5,115 NM
General and administrative 7,286 4,286 3,000 70%
Total operating expenses 94,009 52,699 41,310 78%
OPERATING INCOME BEFORE INCOME TAXES 87,176 32,464 54,712 169%
Provision for income taxes (257) (276) 19 7%
NET OPERATING INCOME 86,919 32,188 54,731 170%
Net foreign currency gains (losses) 2,578 (1,564) 4,142 265%
Net gains on investments 2,321 1,547 774 50%
TOTAL NET REALISED EARNINGS 91,818 32,171 59,647 185%
Net foreign currency (depreciation)
appreciation (28,723) 1,074 (29,797) NM
Net (depreciation) appreciation of
investments 2,250 5,638 (3,388) -60%
INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS ("EARNINGS") 65,345 38,883 26,462 68%
NET OPERATING INCOME PER SHARE:
Basic & Diluted 0.90 0.43 0.47 109%
NET REALISED EARNINGS PER SHARE:
Basic & Diluted 0.95 0.43 0.52 121%
NET EARNINGS PER SHARE:
Basic & Diluted 0.68 0.52 0.16 31%
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING:
Basic 96,573 75,000 21,573 29%
Diluted 96,573 75,055 21,518 29%
DIVIDENDS DECLARED PER SHARE 0.58 0.29 0.29 100%
NM = Not Meaningful EUROPEAN CAPITAL LIMITED
OTHER FINANCIAL INFORMATION
Three and Twelve Months Ended 31 December 2007 and 2006
(in thousands, except per share data)
(unaudited)
Three Months Ended Three Months Ended
31 December 31 December
2007 2006 2007 Versus 2006
euro euro euro %
New Investments:
Senior Debt 25,000 185,650 (160,650) -87%
Subordinated Debt 149,937 129,740 20,197 16%
Preferred Equity 3,263 63,795 (60,532) -95%
Common Equity 1,775 14,031 (12,256) -87%
CDO/CLO Investments - - - NM
Total 179,975 393,216 (213,241) -54%
European Capital Sponsored
Buyouts - 243,367 (243,367) -100%
Financing for Sponsored
Buyouts 178,625 148,091 30,534 21%
Direct Investments - - - -
Add-on Financing for
Acquisitions 1,350 1,758 (408) -23%
Add-on Financing for
Recapitalisations - - - -
CDO/CLO Investments - - - -
Total 179,975 393,216 (213,241) -54%
Realisations:
Senior Loan Refinancings 40,000 122,702 (82,702) -67%
Principal Prepayments 68,218 28,279 39,939 141%
Payment of Accrued
Payment-in-kind Interest
and Dividends and
Original Issue Discount 3,304 2,026 1,278 63%
Sale of Equity Investments - 1,357 (1,357) -100%
Total 111,522 154,364 (42,842) -28%
Appreciation, Depreciation,
Gains and Losses:
Gross Gains - 1,345 (1,345) NM
Gross Losses - - - NM
Portfolio Gains - 1,345 (1,345) NM
Net Gains (Losses) for
Foreign Currency
Translation 46 (829) 875 NM
Total Gains and Losses 46 516 (470) NM
Gross Appreciation at 7,
2, 12 and 2 Portfolio
Companies 18,819 3,678 15,141 NM
Gross Depreciation at 7,
0, 7 and 1 Portfolio
Companies (24,769) - (24,769) NM
Current Portfolio Net
Appreciation (5,950) 3,678 (9,628) -262%
Net Depreciation From the
Recognition of Net Gains - (402) 402 100%
Net (Depreciation)
Appreciation for Foreign
Currency Translation (13,782) 1,819 (15,601) NM
Total Appreciation and
Depreciation (19,732) 5,095 (24,827) NM
Net Gains, Losses,
Appreciation and
Depreciation (19,686) 5,611 (25,297) NM
Other Financial Data:
Net Asset Value per Share 9.67 9.92 (0.25) -3%
Market Capitalisation 756,381 NA NA NA
Total Enterprise Value 1,649,963 NA NA NA
Credit Quality:
Weighted Average Effective
Interest Rate on Debt
Investments 12.7% 12.5%
Loans on Non-Accrual at
Cost 29,875 - 29,875 NM
Loans on Non-Accrual at
Fair Value - - - -
Past Due Loans at Cost - - - -
Past Due and Non-Accrual
Loans at Cost as a
Percentage of Total Loans 1.9% 0.0%
Past Due and Non-Accrual
Loans at Fair Value as a
Percentage of Total Loans 0.0% 0.0%
Number of Portfolio
Companies on Non-Accrual
and Past Due 1 -
Return on Equity:
2007 Net Operating Income
Return on Average Equity
at Cost 9.4% 7.9%
2007 Realised Earnings
Return on Average Equity
at Cost 9.9% 7.9%
2007 Earnings Return on
Average Equity 7.0% 9.5%
Current Quarter Net
Operating Income Return
on Average Equity at Cost
Annualised 11.2% 10.1%
Current Quarter Realised
Earnings Return on
Average Equity at Cost
Annualised 11.2% 10.4%
Current Quarter Earnings
Return on Average Equity
Annualised 3.7% 13.7%
Dividends:
Dividend Coverage
(Realised Earnings per
Basic Share/Dividend per
Share) 1.93 x 0.75 x
Dividend Payout Ratio
(Dividend per
Share/Realised Earnings
per Basic Share) 0.52 x 1.34 x
Year Ended Year Ended
31 December 31 December
2007 2006 2007 Versus 2006
euro euro euro %
New Investments:
Senior Debt 629,618 459,037 170,581 37%
Subordinated Debt 748,207 501,589 246,618 49%
Preferred Equity 3,263 180,216 (176,953) -98%
Common Equity 178,084 23,870 154,214 NM
CDO/CLO Investments 23,483 - 23,483 NM
Total 1,582,655 1,164,712 417,943 36%
European Capital
Sponsored Buyouts 543,677 530,569 13,108 2%
Financing for
Sponsored Buyouts 812,130 601,561 210,569 35%
Direct Investments 95,713 - 95,713 NM
Add-on Financing
for Acquisitions 38,124 32,582 5,542 17%
Add-on Financing
for
Recapitalisations 69,528 - 69,528 NM
CDO/CLO Investments 23,483 - 23,483 NM
Total 1,582,655 1,164,712 417,943 36%
Realisations:
Senior Loan
Refinancings 357,786 247,286 110,500 45%
Principal
Prepayments 319,533 35,433 284,100 NM
Payment of Accrued
Payment-in-kind
Interest and
Dividends and
Original Issue
Discount 20,284 2,223 18,061 NM
Sale of Equity
Investments 9,304 5,005 4,299 86%
Total 706,907 289,947 416,960 144%
Appreciation,
Depreciation, Gains
and Losses:
Gross Gains 2,321 1,547 774 50%
Gross Losses - - - NM
Portfolio Gains 2,321 1,547 774 50%
Net Gains (Losses)
for Foreign
Currency
Translation 2,578 (1,564) 4,142 NM
Total Gains and
Losses 4,899 (17) 4,916 NM
Gross Appreciation
at 7, 2, 12 and 2
Portfolio
Companies 73,590 6,383 67,207 NM
Gross Depreciation
at 7, 0, 7 and 1
Portfolio
Companies (71,340) - (71,340) NM
Current Portfolio
Net Appreciation 2,250 6,383 (4,133) -65%
Net Depreciation
From the
Recognition of Net
Gains - (745) 745 100%
Net (Depreciation)
Appreciation for
Foreign Currency
Translation (28,723) 1,074 (29,797) NM
Total
Appreciation and
Depreciation (26,473) 6,712 (33,185) 0%
Net Gains,
Losses,
Appreciation and
Depreciation (21,574) 6,695 (28,269) NM
NM = Not Meaningful
NA = Not Applicable EUROPEAN CAPITAL LIMITED
STATIC POOL INFORMATION
Portfolio Statistics for Investments Made in Each of the Following Years
(in thousands)
Portfolio statistics(1)(9) 2005 2006 2007 Aggregate
euro euro euro euro
Internal Rate of Return
- All Investments(2)(8) 16.3% 11.9% 16.3% 14.0%
Internal Rate of Return
- Equity Investments
only(2)(8)(10) 38.3% 12.1% 27.0% 18.2%
Original Investments
and Commitments(8) 237,612 1,213,336 1,473,669 2,924,617
Total Exits and
Prepayments of
Original Investments(8) 85,928 594,481 340,514 1,020,923
Total Interest,
Dividends and Fees
Collected(8) 36,684 104,852 51,111 192,647
Total Net Gains
on Investments 202 3,666 - 3,868
Current Cost of
Investments 164,242 658,313 1,145,913 1,968,468
Current Fair Value of
Investments(11) 177,205 607,925 1,129,638 1,914,768
Net Appreciation
(Depreciation)(12) 12,969 (21,754) 15,966 7,181
Non-Accruing Loans
at Cost - 29,875 - 29,875
Non-Accruing Loans
at Fair Value - - - -
Equity Interest at
Fair Value 31,754 205,646 189,352 426,752
Debt to EBITDA(3)(4) 5.2 6.3 6.4 6.3
Interest Coverage(3) 3.1 2.3 3.6 3.1
Debt Service Coverage(3) 1.9 2.0 2.7 2.4
Average Age of
Companies 109 years 92 years 45 years 65 years
Ownership Percentage 11.5% 33.5% 15.9% 21.3%
Average Sales(5) 666,234 483,548 288,536 387,117
Average EBITDA(6) 89,317 65,903 50,690 59,356
Average EBITDA margin(6) 15.4% 14.4% 16.1% 15.3%
Total Sales(5) 4,588,938 16,042,751 15,942,894 36,574,583
Total EBITDA(6) 706,815 2,316,138 2,560,501 5,583,454
% Senior Loans(7) 9.1% 21.5% 34.2% 28.1%
% Loans with Lien(7) 100.0% 100.0% 100.0% 100.0%
(1) Static pool classification is based on the year the initial
investment was made. Subsequent add-on investments are included
in the static pool year of the original investment.
(2) Assumes investments are exited at current fair value.
(3) These amounts do not include investments in which we own
only equity.
(4) For portfolio companies with a nominal EBITDA amount, the
portfolio company's maximum debt leverage is limited to 15 times
EBITDA.
(5) Sales of the most recent twelve months, or when appropriate,
the forecasted twelve months.
(6) EBITDA of the most recent twelve months, or when
appropriate, the forecasted twelve months.
(7) As a percentage of our total debt investments.
(8) Non euro-denominated amounts are retranslated at the
exchange rate ruling at the date of original investment.
(9) Non euro-denominated balances, other than those referred to
in (8), are retranslated at the exchange rate ruling at the balance
sheet date.
(10) Excludes equity investments that are the result of
conversions of debt and warrants received with the issuance of
debt.
(11) Excludes derivative instruments.
(12) Balance sheet appreciation (depreciation) of investments
excluding foreign exchange revaluation.A summary of European Capital's dividend history post IPO and forecast follows. For more information, please visit our website at www.EuropeanCapital.com or call our Investor Relations Department at +44-(0)-800-458-0770.
EUROPEAN CAPITAL'S DIVIDEND HISTORY POST MAY 2007 IPO
Year and Quarter % Change of Dividend Over
Dividend Prior Period Total
euro euro euro
Total 0.99
2008 0.62 68% 0.62
Q4 Forecast 0.16 14%
Q3 Forecast 0.16 23%
Q2 Forecast 0.15 50%
Q1 Forecast 0.15 N/A
2007 0.37 N/A 0.37
Q4 0.14
Q3 0.13
Q2 (IPO = 10 May 2007) 0.10SHAREHOLDER CALL
European Capital invites shareholders, analysts and other interested persons to attend the European Capital Shareholder Call on Thursday 14 February at 14:30 GMT (9:30 EST). Callers within the UK can dial +44-(0)-800-678-1161, while other callers from within Europe should dial +44-(0)-207-740-9501. Callers within the United States should dial +1-866-804-8688. The access code for callers is 320 568.
Point your browser to www.EuropeanCapital.com and click on the Q4 2007 Shareholder Call Slide Show button.
BEFORE THE CALL:
REVIEW SLIDE PRESENTATION IN ADVANCE OF THE SHAREHOLDER CALL
The quarterly shareholder presentation includes a slide presentation to accompany the call that participants may download and print prior to the call. You may wish to take the time to review the slides in advance of the Shareholder Call.
DURING THE CALL:
VIEW STREAMING SLIDE PRESENTATION DURING THE SHAREHOLDER CALL
During the Shareholder Call you may watch and listen to the webcast or listen to the Shareholder Call by phone and step through the slides at your own pace.
AFTER THE CALL:
LISTEN AND VIEW AUDIO SLIDE PRESENTATION AFTER THE CALL
The audio of the Shareholder Call combined with the slide presentation will be made available after the call on 14 February on our website www.EuropeanCapital.com.
AUDIO ONLY PRESENTATION AVAILABLE AFTER THE SHAREHOLDER CALL:
There will be a phone recording available from 23:59 GMT Thursday 14 February until 23:59 GMT Thursday 28 February. If you are interested in hearing the recording of the presentation, please dial +44-(0)-800-032-9687 or +44-(0)-207-136-9233. The access code for callers is 77284642.
For further information or questions, please do not hesitate to call our Investor Relations Department at +44-(0)-20-7539-7100.
ABOUT EUROPEAN CAPITAL
European Capital is a publicly traded investment company for
pan-European equity, mezzanine and senior debt investments with
current capital resources of approximately euro 2.3 billion (US$3.3
billion). It is managed by European Capital Financial Services
(Guernsey) Limited, an indirect wholly-owned affiliate of American
Capital Strategies Ltd. ECFSG, together with its wholly owned
subsidiary European Capital Financial Services Ltd ("ECFS"), is
referred to as the "Investment Manager". ECFS has offices in Paris,
London, Frankfurt and Madrid. As of 31 December 2007 the Investment
Manager had 43 investment professionals and 61 support staff.European Capital invests in and sponsors management and employee buyouts, invests in private equity buyouts and provides capital directly to private and public companies headquartered predominantly in Europe. European Capital generally invests between euro 5 million and euro 500 million per transaction in equity, mezzanine debt and senior debt to fund growth, acquisitions and recapitalisations.
The investment objective of European Capital is to provide investors with dividend income and the potential for share value appreciation by investing in debt and equity investments in private and public companies headquartered primarily in Europe.
European Capital seeks to achieve this through pursuing the following types of investments:
European Capital One Stop Buyouts(TM)
Through our One Stop Buyouts(TM), European Capital provides equity, mezzanine debt and senior debt as the lead investor in the buyout of private and public companies.
Mezzanine Direct with Sponsors
European Capital provides debt and equity financing for buyouts sponsored by private equity firms where European Capital is either the sole or lead mezzanine debt investor.
Syndicated Mezzanine and Senior Debt
European Capital provides mezzanine and senior financing for buyouts sponsored by private equity firms where European Capital is neither the sole nor lead mezzanine or senior debt investor.
Direct Investments
European Capital provides debt and equity financing directly to private and public companies, which is used for growth, acquisitions or recapitalisations, and investing in structured finance vehicles.
Companies interested in learning more about European Capital's flexible financing should contact Simon Henderson or Nathalie Faure Beaulieu at +44-(0)-20-7539-7000 in London, Jean Eichenlaub at +33-(0)-1-40-68-06-66 in Paris, Robert von Finckenstein at +49-(0)-69-71-71-297-0 in Frankfurt, or Luis Felipe Castellanos at +34-91-423-27-60 in Madrid, or visit the website at www.EuropeanCapital.com.
ABOUT AMERICAN CAPITAL
American Capital Strategies Ltd. (Nasdaq: ACAS), with US$19 billion in capital resources under management, is an affiliate of European Capital and a member of the S&P 500. It is the largest U.S. publicly traded private equity firm and one of the largest publicly traded alternative asset managers. American Capital, both directly and through its global asset management business, is an investor in management and employee buyouts, private equity buyouts, and early stage and mature private and public companies. American Capital provides senior debt, mezzanine debt and equity to fund growth, acquisitions, recapitalisations and securitisations. American Capital and its affiliates invest from US$5 million to US$800 million per company in North America and euro 5 million to euro 500 million per company in Europe.
IMPORTANT DISCLOSURES
This document may contain "forward-looking statements". By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Many of these risks and uncertainties relate to factors beyond European Capital's control or which cannot be estimated precisely. These factors include, but are not limited to, uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional, national or international economic conditions, and changes in the conditions of the industries in which European Capital has made investments. Actual outcomes and results may therefore differ materially from any outcomes or results expressed or implied by any such forward-looking statements.
Performance data quoted above represents past performance of European Capital. Past performance does not guarantee future results and the investment return and principal value of an investment in European Capital will likely fluctuate. Consequently, an investor's shares, when sold, may be worth more or less than their original cost. Additionally, European Capital's current performance may be lower or higher than the performance data quoted above.
Nothing in this document is intended to be a profit forecast.
Web site: http://www.EuropeanCapital.com