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FINANCIAL AND LEGAL INFORMATION
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Business description
LBO/GROWTH CAPITAL OPERATIONS
Acquiring a company through an LBO-type operation is generally
performed through one or more holding companies specifically
created to carry out the acquisition. The acquisition is financed
through a combination of long-term debt (generally with a
seven-year minimum term) and equity. The majority of the debt
is repayable at maturity, and a portion of the interest is also paid
on the sale of theCompany. The assets or shares of the underlying
company are the only security provided to creditors, the funds
themselves provide no guarantee. Consequently, in the case of
default, only the equity invested in the operation is at risk. The
other assets held by the private equity funds are not at risk, as
the debt is “non-recourse”.
POSITION OF MAJORITY
OR LEAD SHAREHOLDER
Apax Partners always focuses on taking significant majority or
minority ownership stakes. As a result, it is in a strong position
for negotiating terms of entry, exercises better control over the
strategy of the Company and significantly influences the nature
and timing of the exit process. Apax Partners considers that this
approach facilitates value creation.
AMBITIOUS VALUE-CREATION OBJECTIVES
The partners can leverage their in-depth industrial and business
experience to offer practical support to the executives of the
companies in the portfolio as they address challenges and exploit
opportunities.
The sector investment teams use their in-depth knowledge of
their respective sectors to develop advice on the main strategic
andoperational initiatives.WithinApax Partners LLP, they benefit
fromthe support of theOperational Excellence andDigital teams,
whose management skills are complementary and who offer a
vital contribution to Apax’s value creation strategy, in particular
in areas such as strengthening themanagement teams, improving
operational efficiency, and optimising IT systems and digital
transformation. Furthermore, theCompany has a Capital Markets
team, which creates innovative financing solutions for portfolio
companies.
1.3.7
APAX PARTNERS’ INVESTMENT
PROCESS
Apax Partners France andApax Partners LLP are entrepreneurial
firms that use proven internal procedures. 90% of their capital is
held, directly or indirectly, by their partners. They are managed
via
permanent committees responsible for defining and tracking
strategy, implementing the investment and divestment process
and managing operations. They also have integrated IT systems
refined over the years and based on high-quality software
solutions.
ApaxPartnersMidMarket andApaxPartnersLLPhavecommittees
that are distinct but similar in purpose.
COMMITTEES
The Strategy Committee, composed of all the partners, meets
once a year to define the strategic orientation. In particular, it
studies the overall performance of the funds, the investment
strategy and evaluates the skills of the investment teams.
The Operations Committee includes the three or four principal
shareholder-partners of Apax Partners. The Committeemeets
once a month and on an
ad hoc
basis to ensure the continued
operational management of the Company.
The investment process is managed by three committees:
the Investment Committee, which makes all investment
decisions. Beforebeingpresentedto the InvestmentCommittee,
all investment opportunities are examined by the Approval
Committee, a sub-group of the Investment Committee;
the Divestment Committee, which makes all exit decisions;
the Monitoring Committee. In addition, there are two annual
reviews of the portfolio.
The Monitoring Committee tracks the performance of all
companies in the portfolio, according to a pre-determined
schedule. One or more outside specialists might be invited to sit
on the committee.
INVESTMENT PROCESS
Origination
Investment opportunities can be identified:
principally byApax Partners’ sector teams, owing to their skills,
their experience, and their contacts in the field, with the help
of specific marketing programmes and tools;
but also through the network of intermediaries set up and
cultivated by Apax Partners.
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REGISTRATION DOCUMENT
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ALTAMIR 2016