Press release - 16 September 2002
Utfors in financial restructuring
Utfors AB, a Swedish telecommunication infrastructure and services provider that CapMan’s Finnmezzanine Fund II has invested in, has today 16 September, published a press release stating that it will file for financial restructuring. Utfors has earlier started to seek new sources of financing, after the banks announced that the company no longer had access to bank financing due to a breach of covenants, being a consequence of the weak telecom market. During the first six months of 2002, Utfors’ net sales grew to SEK 307.1 million (SEK 196.0 million in January-June 2001). However, the company’s financial result remained negative. Utfors is listed on the O list of the Stockholm Exchange.
As a consequence of the financial restructuring, the repayment of the loan granted by Finnmezzanine Fund II to Utfors is at risk. The total investment in Utfors is approximately EUR 13.4 million, i.e. about 15 per cent of the total capital of Finnmezzanine Fund II (EUR 88.3 million). Total capital in CapMan’s funds investing directly in portfolio companies is EUR 1,122.5 million. The investment in Utfors represents 1.2% of the capital in these funds. In case the whole investment is lost, the fund will not start generating carried interest to the management company as planned. Private equity fund management companies start to receive carried interest when the return of a fund to investors has exceeded a required cumulative return target.
The possible loss of the investment has already been taken into account in the valuation of Finnmezzanine Fund II’s portfolio in CapMan’s interim report for January-June 2002. Since CapMan is the fund’s management company, the size of CapMan’s own investment in the fund is small, and therefore the potential loss of the investment will not have an immediate effect on CapMan’s result for 2002.
For additional information please contact:
Mr. Ari Tolppanen, CEO, Tel. +358 (0)9 6155 8307 ot +358 (0)500 407 343
‹ Back to previous page