JZ Capital
Partners Ltd
FURTHER
ANNOUNCEMENT IN RELATION TO
THE SALE OF TWH WATER TREATMENT INDUSTRIES
~ US$32 million in initial gross proceeds expected
to be received
with up to US$5 million in additional gross earn-out
proceeds possible,
representing a 3.1x MOIC and 25% IRR ~
07 September 2018
JZ Capital Partners Limited (LSE:JZCP.L or “JZCP”), the
London listed fund that invests in
US and European microcap companies and US real estate, refers to
its announcement made on 3 September
2018 in which it was pleased to announce the proposed
disposal of its ownership interest in TWH Water Treatment
Industries, Inc. (“TWH”).
As previously announced and subject to closing of the
transaction, JZCP expects to realise approximately US$32 million in initial gross proceeds from the
sale (subject to post-closing adjustments), plus potentially up to
US$5 million of additional gross
proceeds from an earn-out based on certain revenue targets of TWH.
Including gross proceeds from a dividend recapitalization in
November 2016, the transaction is
expected to represent a gross multiple of invested capital (“MOIC”)
of approximately 3.1x, and a gross internal rate of return (“IRR”)
of approximately 25%, in each case taking into account the receipt
of full post-closing adjustments and earn-out proceeds.
Additionally, the sale of TWH represents an uplift to JZCP’s NAV at
July 31, 2018 of approximately 2.7%,
again taking into account the receipt of full post-closing
adjustments and earn-out proceeds.
David Zalaznick, JZCP’s
Founder and Investment Adviser, commented: “We are delighted to
realise our investment in TWH. This further demonstrates our
commitment to building liquidity in order to make new investments,
pay down debt and buy back stock. We wish the TWH management team
every success in the future.”
The transaction follows the announcement earlier this year on
14 March 2018 that JZCP sold Paragon
Water Systems, Inc. (“Paragon”) to Culligan
Water, the world leader in residential, office, commercial
and industrial water treatment. JZCP realized US$16.1 million in gross proceeds and expects
remaining escrows of approximately US$0.1
million in connection with the Paragon sale.
Completion of the TWH transaction is subject to a number of
conditions customary for US-style mergers as well as obtaining
shareholder approval from JZCP shareholders at an extraordinary
general meeting of the company to be held on 25 September 2018 and as announced on
4 September 2018.
__________________________________________________________________
Unless otherwise defined, defined
terms in this announcement shall have the same meaning as in the
announcement of 3 September 2018.
This announcement should also be read in conjunction with the
announcements of 3 and 4 September
2018 together with the shareholder circular being
distributed to shareholders in connection with the TWH
transaction.
Ends
For further information:
Ed Berry / Kit
Dunford
FTI Consulting |
+44 (0) 20 3727 1046 / 1143 |
David Zalaznick
Jordan/Zalaznick Advisers, Inc. |
+1 212 485 9410 |
Samuel Walden
Northern Trust International Fund Administration Services
(Guernsey) Limited |
+44 (0) 1481 745385 |
About JZCP
JZ Capital Partners (“JZCP”) is one of the oldest closed-end
investment companies listed on the London Stock Exchange. It seeks
to provide shareholders with a return by investing selectively in
US and European microcap companies and US real estate. JZCP
receives investment advice from Jordan/Zalaznick Advisers, Inc.
(“JZAI”) which is led by David
Zalaznick and Jay Jordan.
They have worked together for more than 35 years and are supported
by teams of investment professionals in New York, Chicago, London and Madrid. JZAI’s experts work with the existing
management of microcap companies to help build better businesses,
create value and deliver strong returns for investors. For more
information please visit www.jzcp.com.