Apax Global Alpha updates NAV, announces Thoughtworks privatisation

Apax Global Alpha (AGA), a London-listed investment company providing access to Apax private equity funds, updated the market on its portfolio on Tuesday, announcing the privatisation of Thoughtworks and its estimated adjusted net asset value as of the end of June.

The FTSE 250 company revealed that Thoughtworks, a global technology consultancy and a portfolio company of the Apax IX Fund, would be taken private by Apax funds.

It said the deal was valued at $4.40 per share, translating to a total enterprise value of $1.75bn.

The transaction represented an approximate 55% increase in AGA's last unaffected valuation of its stake in Thoughtworks, resulting in an estimated uplift of €9m in AGA’s adjusted net asset value.

It said the deal was expected to close in the fourth quarter of 2024, subject to customary closing conditions.

Thoughtworks, founded in 1993, had been part of Apax IX’s portfolio since 2017.

Under Apax's ownership, the company saw a significant increase in its EBITDA and margin, leading to a partial exit through an initial public offering in 2021.

AGA initially committed around $350m to Apax IX in 2016.

As of 30 June, AGA’s estimated adjusted net asset value stood at about €1.237bn, translating to €2.52 per share.

That marked a slight decline from the net asset value figure at the end of the 2023 financial year, of €1.288bn.

The company's estimated total net asset value return for the first half of 2024 was -1.4%, with a second quarter return of -1.0%.

AGA put the negative performance largely down to writedowns in Vyaire, an Apax VIII portfolio company, which impacted both private equity and debt portfolios.

Excluding the Vyaire writedowns, AGA’s total net asset value return for the first half would have been 1.5%.

The portfolio remained heavily weighted towards private equity, accounting for 80% of investments, with the remainder in debt instruments.

AGA also highlighted its new capital allocation framework, which includes regular dividends and the establishment of a €30m ‘distribution pool’ for share buybacks.

The board said the initiative was designed to capitalise on the current investment opportunity presented by the wide discount on its shares.

It said it planned to release its detailed 2024 interim results on 5 September.

At 1240 BST, shares in Apax Global Alpha were up 1.41% at 144p.

Reporting by Josh White for Sharecast.com.