Altamir - Registration Document 2016

FINANCIAL AND LEGAL INFORMATION

Risk factors

Nature of the risk

Risk mitigation

5) Risks related to new investments

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Altamir runs the risks inherent in acquiring new investments, specifically: risks relating to assessing the strengths and weaknesses of the companies, their growth potential, the relevance of their business plan and the capacity of their managers to carry it out; risks relating to an inaccurate estimate of the current value of investments held in these companies and the growth potential of these investments; risks relating to the management of the Company prior to its acquisition that were not identified during the pre-acquisition due diligence, or risks not guaranteed by the sellers in the asset and liability guarantees negotiated by the Company as part of the acquisition; risks relating to terms and conditions governing the financing of the acquisition (e.g. increase in interest rates, activation of accelerated maturity clauses); risks relating to disputes that may arise with sellers or third parties over the acquisition itself or the consequences of the acquisition (e.g. suppliers, customers or banks terminating the contracts that link them to the acquired company due to the change of control); risks relating to the insolvency of one or more companies in which the Company invests (e.g. obligation to provide financial support to the Company in question, loss equal to the acquisition cost, receivorship or liquidation, personal liability claims) and the resulting risk of litigation.

The investment processes implemented by Altamir and the Apax fund management companies (see Section 1.3.7) and the systematic use of the services of renowned auditing and consulting firms, advisory banks and law firms, minimises the risks inherent in investing. Altamir and the Apax fund management companies have acquired deep expertise over many years, enabling them to develop and perfect the sophisticated processes mentioned above.

6) Risks related to the economic environment

Fluctuations in the economy may i) affect Altamir’s capacity to invest, either directly or via the Apax France VIII, Apax France IX, Apax VIII LP and Apax IX LP funds, in companies meeting the selection criteria and to sell investments at satisfactory terms or ii) erode the value of investments that it has or will acquire, as the companies in question may be particularly sensitive to changes in economic indicators, depending on the business sector in which they operate.

By specialising in the economy’s most promising sectors and selecting the sectors’ growth companies and leaders, Altamir minimises the risks related to the economic environment. The risk is also minimised through the geographical diversification of the portfolio companies and the increasing internationalisation of their activities.

7) Special risks related to leveraged transactions

A significant proportion of Altamir’s portfolio is composed of LBO/ LBI-type transactions which consist in acquiring an investment, generally through a special-purpose holding company, with a bank loan serviced by net cash flows (primarily dividends) generated by the investment. Leverage may be high on some of these transactions. These transactions are particularly exposed to phenomena such as a rise in interest rates or a deterioration of the target company or its sector, making it difficult, even impossible, to service the acquisition debt on its original terms. By their very nature, the risk they present is far higher than average.

The debt ratios (overall debt/LTM EBITDA) are very closely monitored by the investment teams and maintained at conservative levels. A significant portion of the financing invested in the holding companies (LBO) are more often than not “bullet” loans, which considerably lightens debt servicing costs during the holding period, with debt being repaid when the investment is sold. It is important to note that each LBO transaction is independent of all other transactions. Any difficulties encountered with a specific transaction have no impact on the other investments. Altamir does not have recourse to debt to finance its investments. As previously indicated, its status as a société de capital risque (SCR) prohibits Altamir from incurring debt greater than 10% of its statutory equity. A credit line is used as temporary financing.

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REGISTRATION DOCUMENT 1 ALTAMIR 2016