Altamir - Registration Document 2016

1

FINANCIAL AND LEGAL INFORMATION

Risk factors

Nature of the risk

Risk mitigation

8) Risks related to the departure of executives in the portfolio companies

The companies in which Altamir invests may be dependent on the presence of one or more key people, whose departure or unavailability would have a significant adverse effect. Because of this, Altamir may need to postpone the sale of the investment in question or to sell it on unfavourable terms.

Evaluating the senior management (motivation, commitments, performance, etc.) is a critical factor in the investment process. Private equity at its core depends on the interests of the managers and investors being perfectly aligned. As a general rule, it is thus in the managers’ interest to collaborate with the investor until the investment is exited. One of Apax Partners’ essential contributions is to constantly strengthen the management teams of its portfolio companies. Altamir and the Apax funds apply the IPEV-recommended (International Private Equity Valuation) valuation rules, which harmonises the approach across all valuations. The valuations are reviewed by the Apax funds’ Statutory Auditors and by Altamir’s Statutory Auditors. Altamir may, via its management company and Supervisory Board, challenge the valuations that have been submitted to it, or modify them if it deems necessary (this has so far never occurred). For over 10 years, Altamir has monitored and published an “Uplift” indicator, which measures the spread between the price at which it sold its investments and their values used to calculate NAV in the preceding period. This indicator has always been positive, demonstrating the Company’s conservative valuation approach.

9) Risks related to valuation of investments

The unlisted investments that Altamir holds or will hold are periodically valued by the Company using the fair value method explained in the notes to the financial statements. These periodic valuations of Altamir’s investment portfolio are carried out to determine Altamir’s net asset value per share, which is published every quarter. Despite the care taken in performing these valuations, no guarantee can be given that each of Altamir’s investments could be sold for an amount at least equal to the value determined by Altamir in this valuation. Only equity investments held directly by Altamir are valued by the Company. Valuation of the investments held via the funds managed or advised by Apax Partners MidMarket and Apax Partners LLP is the responsibility of those companies.

B) FINANCIAL RISKS

Nature of the risk

Risk mitigation

1) Risks related to fluctuations in listed share prices

Altamir may hold listed shares, either because its unlisted companies are floated on the stock exchange and Altamir considers it appropriate to retain its shares for a certain period of time with a view to obtaining a better valuation in the long- term – an objective having no guarantee of results – or because Altamir does not rule out investing directly or indirectly in the capital of a company on the sole grounds that it is listed on the stock exchange, provided that the Company falls within the scope of its investment strategy. Altamir may therefore be affected by a downturn in the market prices of such securities. Furthermore, Altamir may finance its investment in a listed company via a special-purpose acquisition company that incurs debt. In the majority of cases, this debt is guaranteed by listed shares in underlying companies. When the share price of these companies falls, and the average share price over a given period drops below a certain threshold, the holding companies become responsible for meeting collateral or margin calls. In the event of default, banks may demand repayment of all or part of the loan. The sensitivity calculations for margin calls in the event of a drop in the market price are presented in the notes to the financial statements.

It is not Altamir’s primary objective to invest in the shares of listed companies.

Conversely, when the share price of these companies rises, all or part of the balance in escrow with respect to some of these companies may be released.

As Altamir now invests via funds, it is no longer subject to direct margin calls on its new investments.

70 REGISTRATION DOCUMENT 1 ALTAMIR 2016

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