HarbourVest launches all-cash takeover of SVG Capital

HarbourVest Partners launched an all-cash takeover of FTSE-250 listed SVG Capital, with stock in the latter having moved above the offer price in early trading.

Boston, US-based HarbourVest offered 650.0p per share in cash, for a total consideration of $1.35bn (£1.02bn).

The proposal represented a 14.7% premium over the closing price of its British rival´s shares on 12 September.

"While our offer does not currently have the recommendation of the board of SVG Capital, we look forward to a constructive dialogue with them in order to crystallise the certainty of value, today and in cash, to its shareholders," David Atterbury, Managing Director of HarbourVest, said.

By way of response, SVG urged shareholders to take no action ahead of the company´s interim results which were due to be published on 20 September.

"Shareholders will then have the relevant information on the Company and its performance with which to consider the offer," the company said in a statement.

On 4 August, analysts at Stifel told clients in a research report: "The listed private equity sector is continuing to perform strongly, with this driven by earnings growth and realisations. The sector should also see significant gains from the Sterling devaluation. We do not think the share prices and discounts reflect this strong outlook. In anticipation of NAV gains, we are raising fair valuations for all 11 funds under coverage.

"[...] SVG Capital now has a strong balance sheet with a significant (20% plus) net cash balance."

As of 0941 BST shares in SVG were trading higher by 14.83% to 650.50p.