Private Debt - Secondaries

Partners Group has been a successful secondary investor since 1998, investing in private debt since 1999. and focusing on value investing in the private debt secondary market. Partners Group has significant experience and a global team to value underlying assets on a bottom-up basis and assess the value creation strategy of each individual company.

Examples – private debt secondary direct investment


Company. Numericable is the market leader in the provision of broadband cable services in the European French speaking region with more than nine million subscribers, covering approximately 40% of TV households in France and nearly 100% of French cable TV households.

Knowledge of the asset. Having previously invested in the company in 2005, Partners Group had existing, in-depth knowledge of the asset through its comprehensive monitoring process. In Q4 2008, Partners Group saw the opportunity to acquire a senior debt tranche in Numericable from a distressed seller at a discount of over 50%, with its relative value approach identifying the attractiveness of this investment. Due to its extensive knowledge of the company through its previous investments, Partners Group was convinced of the quality and capabilities of the management team and of the company's positioning in its market as a leading triple-play service provider. This presented a clear advantage to Partners Group in order to proceed immediately with the transaction as a short time frame was crucial to the seller.

Exit. Partners Group was able to exit this investment during the subsequent recovery in the senior debt market in Q2 2009 and generated an IRR of over 170% and a multiple on invested capital of 1.4x.

Company. Minimax is the third largest global supplier of integrated fire protection systems and services, with a product portfolio comprising water-based systems (e.g. sprinkler systems), special water systems (e.g. mist and foam), gas systems and special solutions.

Knowledge of the asset. Partners Group invested in the mezzanine debt of Minimax in 2006 and commenced monitoring of the company thereafter. The key investment thesis was Minimax’s stable growing market which was mainly driven by increasing regulations and stricter insurance policies. Additionally, a majority of the company’s fire protection unit revenues are derived from recurring servicing and refurbishment activities. Lastly, the management team has had experience with private equity transactions and was able to adapt quickly to the new ownership structure.
This extensive knowledge supported the investment decision to purchase part of the senior debt tranche from a distressed seller on the secondary market at 54% of face value in Q4 2008. In this transaction, Partners Group was able to benefit from the market dislocation at the time and to take advantage of a compelling investment opportunity to increase its exposure to Minimax’s debt facilities.

Exit. Partners Group divested its senior debt investment in Q3 2009, returning an IRR of 118% at a 1.6x multiple on invested capital.

Juri Jenkner Co-Head Private Debt
René Biner Head Private Finance
Manuel Martiny Investment Solutions Europe