Intermediate Capital sees more benign conditions

published 29 March 2012

Speciality investment firm Intermediate Capital said its funds delivered a strong performance in the year to the end of March, with things looking a little rosier in 2012.

While institutional investors remain cautious to make new investments in volatile markets, the more benign economic outlook since the beginning of 2012 has resulted in a more favourable environment for fund raising, Intermediate said. As a result, it is seeing increased interest in its range of products, and the company continues to make good progress toward its €2bn target for its ICG Europe Fund V.

The group said the performance of its investment portfolio remains solid and provisions for the full year should be broadly in line with market expectations.

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The group, which offloaded its stake in intellectual property management firm CPA Global to European private equity group Cinven in January said it expects to have around £825m of undrawn debt facilities at the end of March, giving it plenty of firepower for new investments, even after it pays off around £320m of debts due in April.

"Again, the more benign economic outlook since the beginning of 2012 has also resulted in greater market activity and our pipeline of new investments is building," Intermediate said.

As agreed by shareholders, the firm's medium term incentive scheme will be terminated at the end of the current financial year, resulting in a one-off release of previously accrued costs to the income statement for the year to 31st March 2012. The firm reckons this release will be in the region of £45m.