Altamir - Registration Document 2016

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1 FINANCIAL AND LEGAL INFORMATION
Presentation and history of the Company
Sector Country Date
of investment
Residual cost
in €m
Fair value
in €m
% of the portfolio
at fair value
Portugal 2016 20.6 33.4 3.8
1) Business description
Nowo is Portugal’s second-largest cable operator. It reaches
25%of the Portuguesemarket, with 910,000homes passed, and
had 178,000 subscribers as of December 2016. The company
provides television, broadband internet access and fixed
telephony services. Its bundled offers comprise dual play (2P)
and triple play (3P) services and, as of April 2016, quadruple play
(4P) as well. Headquartered in Lisbon, the company employs
some 200 people and has 20 stores.
ONI is the fourth-largest B2B telecommunications provider in
Portugal, focusing exclusively on B2B services. The company
operates its own network (more than 9,000 km of fibre
optic lines) covering 85% of Portugal. ONI offers tailor-made
communications & IT solutions (including mobile as of April
2016) to 1,500 customers comprising large, medium and small
companies in sectors such as Financial Services, Utilities, Retail
and Public. Headquartered in Lisbon, the company employs
about 250 people.
2) Why did we invest?
Apax’s teams are familiar with the industry to which these two
companies belong and are particularly well acquainted with
Nowo (formerly Cabovisão), having invested in the asset with
Altice fromMarch 2012 to March 2013. The Apax funds invested
in the company again when Altice acquired Portugal Telecom
and was obliged to divest its other Portuguese businesses.
Both companies have an attractive financial profile and offer
stronggrowthpotential, especially inmobile. Theywere acquired
at a good price and can expect to sell at a higher multiple at exit.
The investment was made with a quality partner, Fortino,
which is headed by former executives of Telenet. Fortino co-
investedalongsideApax funds inNowo/Oni and inMelita (Malta)
and helped to bring in operating advisors to work with the
management team on various projects and capture synergies
between Nowo/Oni and Melita.
3) How do we intend to create value?
The aim is to create an efficient B2B/B2C telecom operator
in Portugal through the launch of a mobile offer as well as
management and organisational improvements.
Nowo’s launch of a mobile offer, its rebranding and a new range
of services should increase customer stickiness andhelpwinnew
customers.WithONI, the objective is to reposition the company
around a new product offer encompassing mobile, increasing
the opportunities to participate in competitive bids.
4) What has been achieved?
Since acquisition, the two operators have carried out a
fundamental reorganisation. The Executive Committee has
been thoroughly renewed. Four operational work-streams have
been started, led by external operational advisors with strong
expertise and who will stay involved with the company over
the long term.
In April 2016, a Mobile Virtual Network Operator (MVNO) offer
successfully launched, stemming customer base erosion. In
September 2016, Cabovisãowas rebrandedNowo. The company
introduced innovative new offers and a fresh product range
including a state-of-the-art TVplatformand new set-top boxes.
5) How is it performing?
The reorganisation initiated by the two operators is advancing
well and beginning to pay off. In 2016, revenue of €118m and
EBITDA were behind plan, due to a one-month delay in the
launchof themobileofferinganda lower-than-anticipatedARPU
(Average Revenue Per User). Nowo’s customer base has been
growing again since September 2016, however.
Going forward, Nowo/Oni will focus on expanding its customer
base andARPU, enhancingbrand awareness and increasing cost
savings in various areas.
The valuation of the investment in Nowo/Oni grew by €12.8m
during the financial year 2016, reflecting a rise in the valuation
multiple.
6) How will we crystallise value?
The group could be acquired by a trade buyer seeking to enter
or consolidate the Portuguese market.
32 REGISTRATION DOCUMENT 1 ALTAMIR 2016