Investment criteria
The text below sets out the overall investment criteria for the NAXS’ investment activities and the advice provided by the Investment Advisor:
Type of fund
Private equity funds with buyout orientation that are managed by established and recognised managers.
A small part of the Company’s assets may however be invested in newly established fund and management constellations with buyout orientation.
Geographic focus
Funds, which have, the Nordic region (Denmark, Finland, Norway and Sweden) or at least one of the Nordic countries as their investment focus, or have a management group dedicated to the Nordic region.
Investment size
Typically SEK 50–300 million depending on each respective fund’s size, the Company’s available means for investments, and the number of fund holdings in the portfolio.
Number of fund investments1)
Commitments made to 7–10 different fund managers’ funds, and over time of different vintages.
Instruments
Interests in private equity funds, e.g. shares or contract-based partnership interests.
The Company’s assets shall not however be invested in pure debt instruments or various intermediate forms such as convertible debentures and mezzanine instruments.
Other restrictions1)
Commitments and/or investments may not be made so that exposure towards the Group’s Net Asset Value (NAV) at the time of the investment exceeds:
- 130 percent2) for commitments towards and/or investments in underlying funds
- 40 percent to funds with the same manager
- 20 percent for the aggregate of all co-investments and 5 percent for each single coinvestment
The term Net Asset Value (NAV) means (i) the aggregate value of all investments and co-investments of the NAXS group, plus (ii) cash or cash equivalents of the NAXS group, and less (iii) all liabilities of the NAXS group where (i) pertain to asset values according to the most recent quarterly or semi-annual reports provided by the relevant private equity funds (most often as net asset values or fair values in accordance with the International Private Equity and Venture Capital Valuation Guidelines) in which investments and co-investment have been made or, where no such value is reported, the booked value in accordance with the latest consolidated financial statement of the NAXS group, and where (ii) and (iii) pertain to reported amounts in the most recent consolidated financial statement of NAXS group.
1) Applies to the Company’s target portfolio in the long-term.
2) The purpose is that the return shall improve through that a relatively larger share of NAXS’ managed capital could be invested from time to time as the underlying private equity funds seldom utilises 100 percent of the commitment. However, commitments may at no point be made with an amount in excess of investable funds readily available within the NAXS group if such amount is not covered through a bank guarantee.