Assets rise at 3i despite cut to Enterprise

 
City A.M. Reporter
PRIVATE equity firm 3i Group was the highest climber on the FTSE 100 yesterday, after writing off the value of its fourth-largest company, Enterprise Group, and laying out new targets to promise investors higher and more stable returns.

Despite the Enterprise Group write-off, 3i’s net asset value was six per cent higher at 351p at the end of March than six months earlier.

Shares in the group bounced as 3i dismissed fears, raised at the beginning of last month, that more British businesses in its portfolio were suffering from the contraction in public spending and weak consumer demand.

“These results were above expectations, although these had been reduced following the pre-close on 1 April, after which we brought our numbers down by four per cent,” research analysts at JPMorgan Cazenove said in note.

In April, 3i had said earnings growth at Northern European businesses was being offset by weakness at British companies.

3i said it was cutting the value of British public sector outsourcer Enterprise to nil to reflect the tough economic outlook, making a £198m impairment against the investment.

The group made a total return of £324m for the year, a 10.6 per cent increase on opening shareholders’ funds.

Share in 3i rose 18.2p, a rise of 6.7 per cent, to close at 289.9p.