Altamir - Registration Document 2016

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FINANCIAL AND LEGAL INFORMATION 1 Business description
1.3.6 ALTAMIR’S INVESTMENT STRATEGY
The Company’s investment strategy is intimately connectedwith
that of Apax Partners. This is a consequence of the Company’s
co-investment in the fundsApaxPartnersmanages, inaccordance
with the co-investment agreement, and of the Company’s
investment in the Apax France VIII-B, Apax France IX-B, Apax
VIII LP and Apax IX LP funds.
GROWTH COMPANIES
The Apax Partners strategy consists in backing companies with
high growth potential, primarily through LBOand growth capital
transactions.
The fundsmanagedbyApax Partners invest ingrowth companies
active in their sectors of specialisation, with the objective of
making them leading companies in their respective sectors.
Investments are acquired with an average holding period of five
years.
These companies are characterised by sound fundamentals. The
principal investment criteria are as follows:
excellent entrepreneurs, with ambitious growth and value
creation objectives;
competitive advantage (technology, concept, brand etc.) or
unique businessmodel (barriers to entry, resilient profile in the
event of a cyclical downturn); and
leader or the potential to become the leader in its sector at the
domestic, European or worldwide level.
SECTOR SPECIALISATION
Since 1990, the Apax Partners strategy has been to invest in six
sectors of specialisation: Technology, Telecom, Retail &Consumer,
Media, Healthcare, and Business & Financial Services.
In 2014, byway of simplification, Apax Partners grouped together
its Technology, Media and Telecomunder the heading “TMT” and
report henceforth on four, rather than six, sectors.
The investment teams are organised around the Apax Partners
sectors of specialisation. ApaxPartners France andApaxPartners
LLP have dedicated teams for each sector. With 22 professionals
in Paris, and more than 100 professionals across the eight Apax
LLPoffices around theworld, theApaxPartners investment teams
are among the largest andmost experiencedprivate equity teams
in France and worldwide.
Each investment is followed by the same team, from acquisition,
through development and until divestment. Apax Partners
employs experienced specialists in each sector.
Owing to thiswell-staffed team, ApaxPartners can simultaneously
(i) actively search for opportunities, (ii) conduct in-depth due
diligence on various transactions, (iii) provide real assistance to
companies in the portfolio and (iv)maintain an ongoing dialogue
with investors.
The principal competitive advantages arising from this strategy
of sectoral specialisation are as follows:
the sector expertise allows the Company to target the best
investment opportunities;
proprietary deals;
limited competition for acquisitions, generating better scope
for return on investment;
rigorous investment procedures; and
value creation, strong commitment from Apax teams.
MANAGEMENT FEES PAID IN 2016
Fund Management fees
Apax France VIII-B 1.85% incl. VAT on capital committed (investment and post-investment periods)
Apax France IX-B 2% incl. VAT on capital committed (investment period)
Apax VIII LP 1.27% incl. VAT on capital committed (investment and post-investment periods)
Apax IX LP 1.375% incl. VAT on capital committed (investment period)
CARRIED INTEREST RECOGNISED IN 2016
Apax France VIII-B, Apax France IX-B
Apax VIII LP, Apax IX LP
20% of the realised or unrealised capital gain provided the 8% minimum annual IRR
(hurdle rate) is exceeded, net of management fees, calculated from the first euro
of capital gain.
As of 31 December 2016, the IRR of the Apax France VIII, Apax France IX and Apax VIII LP funds exceeded the hurdle rate.
Altamir has opted for a conservative accounting policy under which it recognises any potential carried interest liability, even if the
hurdle rate is not achieved in a given year.
48 REGISTRATION DOCUMENT 1 ALTAMIR 2016