“First of all, we would like to pay tribute to and thank François Tesch, our inspiring and enterprising chairman and founder, who will be stepping down at the next general meeting, after having left an indelible mark on Luxempart,” said the two managing partners of the Luxembourg investment company, Olaf Kordes and John Penning. “We look forward to working with his successor and would like to thank them both for their confidence and assure them of our continued commitment and motivation,” they wrote to François Gillet.
The veteran investor, who has been on the company’s board since 1992, will retire from Safina later this year, allowing him to devote more time to Luxempart. Tesch will not be the only one to leave the board of directors, with the departure of Pierre Drion. Xavier Coirbay, who is one of the pioneers of Sofina’s investment fund business and therefore has extensive knowledge of it, and Owen Tesch, one of François Tesch’s two sons, will also join the board.
10% dividend increase
“In an uncertain environment, characterised by the war in Ukraine, turbulence in global supply chains and inflation, we are pleased to post a stable evolution (+0.6%) of our net asset value, and thus a positive overall performance for our shareholders, well above the evolution of the global market,” noted the press release published on Friday 24 March morning on the occasion of the annual results.
Luxempart will generate a return of 2.3% for its investors, compared with -19.3% for the MSCI Europe Mid Cap, which is used as the benchmark for international comparisons each year. This will result in a dividend of €1.98, up 10% on last year.
The two managers are continuing to implement the strategy they started three years ago, with slightly fewer but larger investment lines and an orientation of part of their capital towards investment funds, not only European but also American, while remaining relatively prudent.
Six exits, three new investments
“In our direct investment business, we continued to rationalise our portfolio in 2022, with six exits completed in the year [including Rimed for €52.8m and eduPRO group for €76.2m], generating proceeds of €214m. But we also continued to invest in new companies, with three new investments made during the year, as well as two significant additional investments in existing lines, totalling €161m of new deployments. Our portfolio companies were also very active during the year, with eight of them completing more than 20 buy-and-build deals together in 2022,: said the two men.
The three new investments are Metalworks (€32m for 31.5% of the capital), Salice (€25m for 6.7%) and Nexus AG (€72.7m for 8.4%).
“Our investment fund business also generated significant revenues in 2022, at €135m, mainly from our historical sponsored relationships, which made significant exits. In line with our diversification strategy, we made €79m in new commitments during the year, in 12 new funds located mostly outside Europe,” the statement said. The Silicon Valley Bank debacle is not expected to have an impact on Luxempart’s exposure.
Since the beginning of the year, Luxempart has invested €110m in Kestrel Vision and sold its shares in Danish company TCM for €5.3m.
This story was first published in French on Paperjam. It has been translated and edited for Delano.