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29 Jul 2021 - Performance Report: Vantage Private Equity Growth
By: Australian Fund Monitors

Report Date29 July 2021
ManagerVantage Asset Management
Fund NameVantage Private Equity Growth
StrategyPrivate Equity
Latest Return DateJune 2021
Latest Return2.42%
Latest 6 Months24.10%
Latest 12 Months58.73%
Latest 24 Months (pa)30.34%
Annualised Since Inception18.30%
Inception Date01 May 2015
FUM (millions)AU$95
Fund OverviewThe current offer of Vantage Private Equity Growth 4 is is a closed-ended fund. The Fund's inception date is 30 September 2019. The close date is 30 September 2021.

The Fund's investment strategy is focused exclusively on lower to mid-market Growth Private Equity. This segment of Private Equity focuses on investments into profitable businesses with proven products and services.

These businesses typically have a strong market position and generate strong cash flows, which will allow the Fund to generate strong consistent returns to investors, while significantly reducing the risk of a loss within the portfolio.

The Fund will invest in Private Equity funds based in Australia, along with Permitted Co-investments, to create a well diversified portfolio of Private Equity investments. These investments will be made by the Fund, by making Commitments to the Private Equity funds of the best performing Private Equity fund managers, that in turn make investments into profitable companies requiring Later Expansion and Buyout capital to accelerate their growth and enhance their value.

Distributions are paid as distributions are received from underlying funds.
Manager CommentsPrior Vantage Funds continue to perform well with June seeing a composite performance of +2.42%. Quarterly performance was +8.64% and 12 month performance +58.73%. This strong performance was achieved as a result of strong underlying portfolio company performance as well as the sale or IPO listing of number of portfolio companies during the March and June 2021 quarters. Across the June 2021 quarter five underlying company exits were either completed or announced from Vantage Fund portfolios. These exits will deliver Vantage's Funds an average gross 4.9 X return on invested capital representing an average gross rate of return of 73.9% per annum. They expect the environment for exits to continue to be strong for the remainder of the year. Additional information can be found in the managers report linked below.

Vantage continued to build out the VPEG4 portfolio with approval to commit $20m to Advent Capital Partners 3 Fund continuing their successful relationship with the manager who is one of Australia's leading mid-market buyout firms. This commitment comes on top of their decision to commit another $10m in capital to the CPE 9 fund taking their total commitment to $20m. Investors in VPEG4 will now gain access to four managers and 6 portfolio companies with a number of new commitments to be made before the end of 2021.

VPEG3 investors benefited from the recent listing of Best and Less (ASX:BST) which was a $60m IPO completed in July. Best and Less Group comprising of much-loved retail brands Best & Less in Australia and Postie in New Zealand, is a leading value speciality retailer with a focus on baby and kids' apparel. Best and Less was part of an acquisition by Allegro Fund III in November 2019 of Value Retail Group. Through a combination of repositioning its product range towards the value apparel market, focussing on e-commerce business, store network expansion and ongoing cost reductions net profits have grown from $13.8m in 2019 to a forecast $40m in 2021 in spite of the challenging conditions presented by COVID related temporary store closures. Vantage expect this exit will result in another pleasing result for VPEG3 investors and continues the series of excellent exits achieved for VPEG investors in the June quarter.
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