Connection Capital, the specialist private client investment business, has raised £4.3million from private investors keen to invest in a portfolio of unquoted stocks acquired by investment firm, Hambro Perks, from global fund manager, Invesco.
Hambro Perks acquired the diversified portfolio of 16 unquoted US and UK life sciences and technology assets at a deep discount to its net asset value (NAV) of £1.2bn in January this year, via the HP Special Opportunities Fund I LP (HPSO) which was established for the sole purpose of acquiring the Invesco assets.
- Discounted deal arose from Invesco’s decision to focus on liquidity in retail funds
- Assets with enterprise value of £1.2bn acquired by venture capital specialist investment firm Hambro Perks
Strong demand from Connection Capital clients to participate in HPSO saw the fund significantly oversubscribed by more than double the available capacity.
The opportunity arose after Invesco announced in early 2020, its intention to sell all unlisted stock holdings, as it sought to improve liquidity of its UK equity retail funds by moving towards more liquid, listed large cap stocks.
HPSO acquired the portfolio in Q1 2021, with a strategy of focussing on driving portfolio exits, with the potential for early liquidity events and high target net returns for investors.
The assets comprised within the portfolio include Gelesis, a biopharmaceutical company that produces a US FDA-approved anti-obesity drug; First Light Fusion, a company that is developing safe, efficient nuclear fusion energy; Nexeon, an innovative battery technology business; and Vedanta, developers of immunotherapies for cancer treatment.
Lorna Robertson, Head of Funds at Connection Capital, comments, “The circumstances surrounding this deal were an unusual but extremely appealing opportunity for our clients.”
“When a shift in investment focus prompts one of the UK’s best-known fund managers to divest a portfolio of high-quality assets for materially less than its marked valuation, demand is inevitably going to be intense. So we weren’t surprised to see this opportunity sell out within days.”
“HPSO Fund I offers multiple opportunities to unlock value from portfolio businesses that have substantial intrinsic worth, revenues and commercial traction in sectors that are relatively resistant to Covid-induced economic turbulence, purchased from a highly motived seller. Invesco has an excellent track record of identifying good quality businesses to back. Alongside the very attractive entry price relative to NAV, the dynamics of many of these investments themselves give good reason to think that there is material uplift already embedded in the portfolio.”
“Hambro Perks’ existing relationship with Invesco meant they were able to act quickly, and our strong relationship with Hambro Perks meant that we were able to secure an allocation for private investors in this fully visible portfolio, alongside some very high-calibre co-investment partners.”
About Connection Capital
Connection Capital LLP is a Financial Conduct Authority authorised and regulated, specialist syndicator of investment funds from private professional investors into direct private equity, private debt and commercial property deals, as well as alternative asset funds. It currently has some £320 million of funds under management across a diverse portfolio.
Connection Capital provides a specialist managed service to help professional clients build up their own alternative asset portfolios. Private investors self-select which opportunities they want to take a stake in. Opportunities are identified and negotiated by Connection Capital, which also carries out all due diligence and manages the investment from completion through to exit, on its clients’ behalf.
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