ON THE SPOT
Ethos finding its base in long-term game of private equity
Business Day asks CEO Peter Hayward-Butt why they have not found favour with the market
The share price of Ethos Capital, a public vehicle for private equity, has steadily since listing in August 2016, infected perhaps by the Brait taint. Out with results on Thursday, Ethos’s net asset value has edged up 7% since going public, perhaps as only 18% of its fund was invested. Since year-end it has struck new deals, however, taking invested capital to 40%. Business Day asked CEO Peter Hayward-Butt why they have not found favour with the market. Obviously, the Brait factor hasn’t helped — when we first went to the market, Brait was trading at a 20%-30% premium to NAV [net asset value] and it’s now at a 30% discount…. I think the biggest issue really is private equity by its nature is a long-term game. When we listed we said to those investors coming in, ‘you need to have both the commitment and the patience to see it pan out’. Over time what you want is that the return on your portfolio exceeds the cost of equity, in which case you should trade at a premium — but we need to ...
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