Fund Profile


Disclosure – Non-Independent Marketing Communication

This is a non-independent marketing communication commissioned by NB Private Equity Partners. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.

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NB Private Equity Partners (NBPE) is a London-listed private equity investment fund. It is unique in this sector, in that the underlying portfolio largely consists of equity co-investments made with a broad range of different private equity managers.

The managers and their approach differentiate NBPE from all of the other LPE funds. However, as we discuss in the Performance section, the recent sell-off negatively affected NBPE’s share price – both relative to wider equity markets and to the LPE sector (as represented by the Morningstar LPE ex 3i Index).

NBPE’s board and manager took decisive steps as a reaction to the unprecedented events of this year. The trust has drawn down an additional $160m of the credit facility so that at the end of April 2020, it had liquidity of $205m. Alongside this cash, Neuberger Berman (NB) has provided information that as at 30 April 2020, the ‘adjusted’ commitments (i.e. net of those unlikely to be called) amount to c. $126m. As such, the commitment cover ratio is 163%.

As we discuss in the Portfolio section, NBPE is largely exposed to North America (74% of the portfolio), with Europe at 22% and RoW at 4%. By sector, the portfolio is relatively well diversified, with exposure to areas which might be more resilient to the economic slowdown. These include healthcare, financials and TMT, together adding up to c. 50% of the portfolio. On the other hand, companies in the consumer, industrials, energy and business-services sectors together account for 46%.

Based on the most recently published NAV (31 March 2020), and adjusting for quoted holdings movements, NBPE trades on a discount of 42% (Source: Numis).

Analyst's View

NBPE’s portfolio is invested in high-quality businesses, alongside a range of top private-equity managers. All companies will be affected by the pandemic, and we’d expect the NAV to fall once the impact becomes clearer. However, in drawing down $250m of the $300m credit facility, NBPE has taken steps to ensure it does not face a financing squeeze. This, alongside publishing the updated commitment cover, sends a strong statement that this is unlikely to be a financial crisis for NBPE.

Given the emphasis on strengthening the balance sheet of the trust, it seems unlikely dividends will continue. NB has stated that private-equity managers are relatively well placed to nimbly react to business issues. While NBPE will publish monthly NAV estimates, the impact from COVID-19 may take until June’s quarterly report to be better reflected in the NAV.

Whilst NBPE’s ordinary shares are the most highy geared in its peer group, the fact NB is more in control of its investing activities than peers means that the higher gearing doesn’t necessarily mean the trust is the most risky. NBPE’s performance has been good historically, and it is a clearly differentiated trust within its sector. As we discuss in the Charges section, it has some fee-related advantages. However, the shares have significantly underperformed the market and trade on a discount of 42% (source: Numis). Likely catalysts for a re-rating will be updated valuations and the consequent potential for a resumption of buybacks.

bull bear
Unique investment strategy, historically having delivered sector-leading returns Geared exposure to companies which are themselves often geared
Low-cost access to direct private-equity deals Illiquid underlying investments mean liquidity needs to be managed
Wide discount to historical NAV Valuations on portfolio companies are performed relatively infrequently
Continue to Portfolio

Fund History

20 May 2022 A hands-on approach
Private equity trusts offer a solution for investors seeking a tightly controlled and monitored approach to ESG…
06 May 2022 Results analysis: NB Private Equity Partners
NBPE had its best year on record in 2021…
20 Apr 2022 On the hunt
We review discounts in the investment trust space against a backdrop of harsh conditions...
23 Mar 2022 A differentiated approach to building long-term value
When it comes to choosing a private equity manager, it is vital to choose carefully...
09 Mar 2022 The under-explored power of listed private equity
Private equity remains off piste for most investors despite its potential appeal as a core holding…
02 Mar 2022 Spread 'em!
We explore how much dispersion in returns of stocks drive the differing fortunes of trusts…
02 Feb 2022 Getting in on the act: Private markets
Private markets could be the next big opportunity for investors…
21 Jan 2022 Fund Analysis
NBPE has had an exceptional 2021, but prospects remain bright...
12 Jan 2022 Bargain hunt
We survey the discount opportunities in the market and update on the performance of our Discounted Opportunities Portfolio…
22 Nov 2021 Flash update: NB Private Equity Partners
October NAV from NBPE shows continued momentum…
17 Nov 2021 How Do You Like Them Apples
Judging whether the US market is expensive is not as easy as many make it out to be…
10 Nov 2021 Is your portfolio an ‘80s throwback?
Private equity investment trusts could add valuable diversification to private investors portfolios, which often still resemble old fashioned 60/40 strategies…
23 Sep 2021 Even better than the real thing
We explain private equity and examine why tweaks to listed private equity trusts give the sector an advantage over the direct route...
20 Sep 2021 Flash update: NB Private Equity Partners
NBPE’s NAV momentum continues, and the portfolio’s maturity would indicate that further progress cannot be ruled out…
15 Sep 2021 Bargains galore
We review our discounted opportunities portfolio, with one constituent rallying more than 30% in just two months…
04 Aug 2021 60/40 and other dinosaurs
A simple practical step to take your portfolio from the 1990s into the 2020s...
30 Jul 2021 The evolution of an investment thesis
NB Private Equity Partners explain why they think a key advantage of private equity is the ability to magnify potential growth via well timed business decisions...
16 Jul 2021 Flash update: NB Private Equity Partners
Recent write-up leaves NBPE’s NAV +22.2% YTD with potentially further progress to come…
14 Jul 2021 Grade inflation
We look at how our discounted opportunities portfolio has done in the first half of the year and update on the performance of our long-term rated funds…
09 Jun 2021 Slides and Audio: Masterclass in Private Equity investing
Watch the replay of our roundtable teach-in led by William Heathcoat Amory, head of research at Kepler Trust Intelligence...
26 May 2021 Fund Analysis
NBPE’s wide discount appears unwarranted...
19 May 2021 The complexity premium
We examine the idea that extra returns can be obtained from buying investments which are perceived to be more complex by most investors...
27 Apr 2021 Flash update: NB Private Equity Partners
NBPE has reported a very strong start to 2021, building on an excellent 2020…
14 Apr 2021 Wide Boys
We review our portfolio of chonky discounts as one star performer hits its target…
06 Apr 2021 More than meets the eye with private company investing
The case for having an allocation to private companies has become compelling in recent years – yet not all ways of making unquoted investments are made alike...
01 Feb 2021 Standing on the shoulders of giants
We take a look at NBPE, a trust which is managed using a unique co-investment strategy, and has the promise to become one of the future stars of the private equity space…
14 Jan 2021 Get 'em while they're hot!
We review the widest discounts in the investment trust universe and look at our selection of attractively cheap trusts…
11 Dec 2020 Flash update: NB Private Equity Partners
Significant realisation should prompt investors to take another look at the discount to NAV...
23 Nov 2020 In adversity, strength
In this article we look at a number of catalysts that could see NBPE’s discount narrow, potentially offering a ‘double whammy’ in terms of returns for investors…
11 Nov 2020 Now that's what I call a discount!
Presentations and audio from our conference focussed on discount opportunities in the investment trust sector…
11 Nov 2020 Slides and Audio: NB Private Equity Partners
View the presentation and listen to the audio from our 'Discounts in Focus' event on 05 November...
05 Nov 2020 The haves and have nots
With listed private equity trust discounts widening, are investors mistakenly assuming that underlying portfolios will perform worse than public market indices?...
28 Oct 2020 Can the passives bull market continue forever?
We examine what the trend to passive investing means for active investment strategies…
28 Oct 2020 Fund Analysis
NBPE is unique in the LPE sector, which means its wide discount is attractive…
22 Oct 2020 Spotlight on discounts
As our event focussed on discounts approaches, we update our portfolio of discount opportunities and review discounts across the wider IT universe…
22 Jul 2020 A game of four quarters
Seven trusts, two quarters. Are our team still happy with their trust picks for 2020?
03 Jun 2020 Price is what you pay, value is what you get
The listed private equity sector has seen discounts widen markedly, but does this present an opportunity?
14 May 2020 Fund Analysis
NBPE’s discount has widened dramatically, but its managers have already taken decisive steps to protect the trust…
25 Mar 2020 Of mice and men
Our ‘best laid plans’ have somewhat ‘gang aglay’ since the KTI team put forward its best ideas for 2020 in early January…
04 Mar 2020 Three real world examples of the value-creating powers of private equity
At their core, private equity trusts like NBPE create value by supporting growing companies - here, we discuss three such companies and how the investments worked...
29 Jan 2020 How investment trusts offer access to private equity
Listed private equity trusts give private investors the opportunity to tap into private equity - and NBPE's unique fee structure, combined with an impressive track record, makes it one of the best...
29 Jan 2020 Why private equity could boost your portfolio
Listed private equity offers clear diversification benefits for investors - but not all LPE trusts are cut from the same cloth...
02 Jan 2020 Crystal Balls
Drunk on our success in choosing funds to perform well in 2019, the team at Kepler Trust Intelligence is back at the table with a glint in its eye…
13 Nov 2019 The parallel worlds of listed private equity
Some private equity trusts are on an average premium of 18%, whilst others trade on discounts of 15%. Are we missing something!?
13 Nov 2019 Fund Analysis
NBPE offers continuing good performance, a unique lower cost approach, and yet is still on a wide discount…
24 Jul 2019 Fool's gold?
We examine the relationship between how much a fund costs and how it performs, with surprising results...
13 May 2019 Fund Analysis
A wide range of discount-narrowing initiatives have built a good foundation for investors in NBPE...
17 Oct 2018 Missing something?
As more and more of the world's most exciting companies delay listing, the opportunity in private companies has become too large to ignore...
17 Oct 2018 Fund Analysis
NB Private Equity Partners focuses on direct equity and debt investments in private equity-backed companies, with investments made alongside private equity sponsors...
15 Aug 2018 The income edge
Last year saw investment trusts soar in popularity among both retail investors and wealth managers. We examine why this has happened, as well as the structural advantages of investment trusts for income-hungry investors...
22 Feb 2018 Fund Analysis
NB Private Equity Partners (NBPE) focuses on direct equity and debt investments in private equity-backed companies, with investments made alongside private equity sponsors...
22 Feb 2018 Once bitten, twice shy
Fearful memories of 2008 mean discounts remain wide in the listed private equity sector, despite excellent returns from some of the trusts it contains...
24 Nov 2017 Fund Analysis
A diversified private equity trust, which has recently undergone some significant change, that offers a yield of 3.5% and trading on a wide discount...
05 Jul 2017 Searching for value
We look at how investment trusts are seeking value in the booming listed private equity sector...
View all

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