Advance Equity Holding

BSE 6A8 Bloomberg ADVEQ BU

Basic Facts
Fund Type:	Closed-end publicly traded vehicle for private equity investments
Fund CEO:	Ventseslav Petrov
Capital under management:	BGN 37.715 m  / EUR 19.28 m
Number of shares issued:	35 945 592
Launch date / Vintage year:	10 January 2006
Country of registration:	Republic of Bulgaria
Stock Exchange:	Bulgarian Stock Exchange-Sofia
Ticker:	6A8
Currency:	Bulgarian Lev (BGN)
Management Fees:	2.5% (VAT excl.) per year on the net asset value of Advance Equity Holding's unconsolidated balance sheet ; 20% of the net income of Advance Equity Holding upon successful sale of each investee company (i.e. "exit").
Investment Manager:	Karoll Finance

 

 

Fund's Highlights

 

 

Advance  Equity  Holding  JSC is  a  private  equity  investor  with  a  mid-  to  long-term  interest  in  private  (non-listed)  companies. The company was established in early 2006, went public via initial public offering of new shares on the BSE-Sofia in mid-2006, and subsequently increased its capital under management in mid-2007.

 

The focus of Advance Equity Holding’s activity is to invest the funds raised from the capital market in start-ups or young and developing private companies having a high growth potential, as well as a capable and devoted management team. Advance Equity Holding provides financing to promising business projects against acquisition of equity stakes in the firms.

 

The nature of Advance Equity Holding’s activity is identical to that of the popular in the USA and Western Europe private equity funds. The status of a public company allows for an easier fund raising and grants a higher transparency of the investments.

Investment Objectives

The main objective of Advance Equity Holding JSC is to seek a long-term capital appreciation through structuring and management of a portfolio of private companies. Advance Equity Holding acts as a founder of new companies or buys stakes in existing ones, finances their development for a given period of time (mid- or long-term) and exits the investment through a sale to a strategic or another financial investor, or through a floatation of the company on the stock exchange.

 

Advance Equity Holding is an active partner to the entrepreneurs in all of its portfolio investments. The company not only provides the necessary financing, but also supports the development of the projects through participation in the strategic management, the consulting on various financial issues (incl. accounting and legal services), the provision of a wide network of useful business contacts.

 

 

Investment Strategy

Advance Equity Holding takes a general investment approach, assessing business plans and firms from different industries of the national economy, which could benefit most from the economic development of Bulgaria and its accession to the European Union.

 

The investment strategy of Advance Equity Holding implements filtration and selection of business projects with excellent growthprospects and functional small private enterprises inneed of financial support for expanding their activities,marketing of new products or technological innovations. Main criteria for selection of the portfolio investments are:

• Competent management team with a proven experience;
• Business model with potential for high growth and successful realization based on offering a competitive product or service;
• Expected internal rate of return of no less than 20%  annually over a projected investment period of 5  years.

 

Consultant on the implementation of the investment strategy of Advance Equity Holding is Karoll Finance.