KUALA LUMPUR – 29 April, 2016: Ekuiti Nasional Berhad (Ekuinas) maintains its Internal Rate of Return (IRR) for both of its funds at above 12 per cent per annum last year, surpassing its expectation amid the volatility of global economy.
The government-link private equity fund management firm’s Direct (Tranche I) Fund had recorded a gross portfolio return of RM591.3 million, which translates to a gross annualised IRR of 14.8 per cent and a net annualised IRR of 10.9 per cent, despite of the oil price slump.
Its second fund, Ekuinas Direct (Tranche II) Fund also posted a gross portfolio return of RM133.3 million at a gross annualised IRR of 13.0 per cent and a net annualised IRR of 5.7 per cent.
Chairman Raja Tan Sri Arshad Raja Tun Uda at the announcement of Ekuinas’ financial year ended Dec 31, 2015 (FY2015) results, yesterday, said that the firm has succeeded in maintaining its IRR above the minimum target per year (12 per cent) for the six year running.
He noted that the company had demonstrated its ability to withstand economic downturns, although last year proved to be a formidable year for business in the country.
He also said, due to the volatile equity market last year, capital was deployed in a prudent and thoughtful manner which saw the firm undertaking nine direct and outsourced investments with a total committed capital of RM338.7 million.
He added, this brings the total cumulative committed investments undertaken by Ekuinas to 45 amounting to approximately RM2.8 billion, together with private capital facilitated a total capital deployment of RM3.4 billion.
He also pointed out that the investments undertaken by the firm last year include maiden investment into the healthcare industry, with 60 per cent equity acquisition in MediExpress (Malaysia) Sdn Bhd and PMCare Sdn Bhd for a total committed capital of RM79.8 million.
“Ekuinas had also backed its education portfolio, ILMU Education Group (ILMU) and Orkim Sdn Bhd by providing additional capital of RM150.0 million and RM70.0 million respectively,” the chairman added.
Chief Executive Officer Syed Yasir Arafat Syed Abd Kadir, presenting the detailed results said that on its social objectives front, Ekuinas had increased the Total Bumiputera Equity value by RM3.7 billion, or 1.6 times the capital invested through its investment activities during the period.
Its Total Shareholders’ Value for all portfolio companies had recorded an increase as well, which is by RM4.7 billion, equivalent to 2.1 times of the invested capital, reflecting the firm’s model of increasing wealth for all Malaysians.
Syed Yassir added, Ekuinas’ portfolio companies had also continued to grow with the employment of 485 managers and 15,177 employees, out of which 31.1% and 51.6% were Bumiputeras respectively.
“This represents an increase of 12.7 per cent Bumiputera managers and 31.5 per cent Bumiputera employees since Ekuinas’ entry,” he added.
He said, moving forward, the firm is committed in ensuring that it is able to anticipate changes in the market and position its portfolio companies accordingly.
“Although the outlook is uncertain and risks persist, it is also an exciting time for Ekuinas. We are hopeful that our active portfolio management strategy and the implementation of various value creation strategic initiatives will bode well for our portfolio companies in the years to come,” he added.