MEXICO ADVOCACY DAY May 5th, 2015

Transcription

1 MEXICO ADVOCACY DAY May 5 th, 2015

2 The origin of Fondo de Fondos Fondo de Fondos was created to serve as an economic policy instrument exclusively focused in the PE Investments. FdeF s goal is to create shareholder s value, to drive the development of the industry in Mexico and participate in the development of small and medium-sized enterprises. The Mexican Development Banks participate on a third-floor scheme, having an independent and professional administration and achieving risk diversification with a multiplier effect on their investments.

3 The origin of Fondo de Fondos Before Fondo de Fondos creation, the Mexican Development Banks supported companies through Equity Investment Programs. However, the market was presenting the following problems: Management deficiencies at different stages of investment processes Lack of institutional investors High administrative expenses Insufficient exit options Inefficient tax regime Few companies supported

4 The origin of Fondo de Fondos In 2003, the Mexican Development Banks along with the Trade Development Agency (TDA-USA) conducted a study to improve the Private Equity market in Mexico. The results included: Appropriate legal framework Tax transparent vehicles Tax incentives for capital gains Corporate governance and protection to minority shareholders Alternative exits schemes Reform to the Securities Market Law FICAP Reform to the Income Tax Law SAPI www. negociosextrabursátiles.com More institutional investors Afores CKD s

5 Private Equity in Mexico 2005 Large Mexico-only Funds Large + Medium JP Morgan Carlyle Latin America Enterprise Mexico Retail Pan-regional Funds Medium Medium & Small Intel FomedeCapital Nexxus Discovery Monterrey Capital Barings Darby Nafta Fund Wamex Advent Int l Valanza GE Capital O Connor LaSalle Hines Prudential Corporate IGS Properties Small Latin Idea Guanajuato Sinaloa Tijuana PYMEX Fondelec Venture Growth LBO Mezzanine Special Infrastructure Real State Secondary The market in Mexico had few players

6 Private Equity in Mexico 2014 with CKDs Mexico-only Funds Pan-regional Funds CKD Southern Kimco Large Sterling Mexico Walton Cross Realty Partners Retail Street Advent Navix Artha MRP Beamonte Int l Macquarie Rock- Thor Paladin Black Creek TRG ARC Linzor Prudential Wood Large + Lapef Fund Conduit Marhnos RE LaSalle Medium JP Valanza Capital Nexxus AMB ING Paul Morgan O Connor EMX Hines Property ClarionCapital Tresalia Aureos Acon I2 Discovery GE Corporate PLA Capital Central Properties Proequity Cordiant Medium Valley PineBridge GEE Plani Grupo CAMIF Vertex FunAureos Citi RW DWM Península Ventur Actis Capital Evercore Wamex Darby e Darby Generation Capital I RLD Gramercy Promecap mining Northgate Alisios USRG Sevin Medium Sierra Nafta Arzentia Rosen Alia + Small V. Fund Latin Excel V. Acción Capital PYMEX Gerbera Idea Thayer IGS Índigo Alta Fica New V. Alta Clarum IGNIA IGNIA V Logistics GuanajuatoGrowth Growth Clean Guanajuato Adobe Alta GreenTek Small Angel V. Tech Ingenia Capital crece SinaloaInsignia Mex. VC. Venture Growth LBO Mezzanine Special Infrastructure Real State Secondary Today it has a broader range of options

7 Accumulated fund raised in billion dollars Number of GP s Private Equity in Mexico Private Equity in Mexico Billions of dollars 125 Source : AMEXCAP

8 Corporación Mexicana de Inversiones de Capital 100% 97% 50% De 20 a 30% Legacy portfolio and others. Other Other Pension Funds and other investors 3% 50% De 80 a 70% Up to 2006 ANEXO MDD in 67 Funds and 11 co-investments, and 434 companies

9 Private equity in Mexico Source: PRIVATE EQUITY IN MEXICO Primed for significant growth, BAIN & COMPANY,

10 Private equity in Mexico Source: PRIVATE EQUITY IN MEXICO Primed for significant growth, BAIN & COMPANY,

11 Private equity in Mexico Source: PRIVATE EQUITY IN MEXICO Primed for significant growth, BAIN & COMPANY,

12 Our diversification policy Type of Funds Number of funds in Portfolio Investment Stage Fund diversification Vintage Industry Region 12

13 Brazil Mexico Paraguay Colombia Argentina USA Bolivia Venezuela Chile Trinidad & Tobago Peru Dominican Republic Guatemala Honduras Panama Uruguay Ecuador Spain China Costa Rica MDD Corporación Mexicana de Inversiones de Capital Country allocation of capital invested by regional funds* 1,200 33% 46% 1, % % % 7% 6% 6% 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1% 0% 0% 0 National Funds Regional Funds *Statistics based on the history of regional funds that are part of the portfolio of Fund of Funds, including 3,412 invested in the region 13

14 Corporación Mexicana de Inversiones de Capital IRR Comparative in dollars at March 31, % 12.7% 12.0% 10.0% 8.4% 8.6% 10.0% 8.2% 9.32% 8.0% 6.0% 4.0% n.d. 2.4% 4.0% 4.0% 2.0% 0.5% 0.0% -2.0% Vintage Vintage % FdeF CalPERs Preqin Dow Jones Industrial S&P 500 Nasdaq 100 Source: CMIC.

15 IRR J CURVE 40% 20% Projected yields of Fondo de Fondos REAL & PROJECTED Quarter FdeF Mex II december 2023 Estimated IRR 17.1% FdeFMex I december 2017 Estimated IRR 13.5% 0% Vintage december 2012 IRR 10.0% -20% -40% Vintage december 2007 IRR 9.4% -60% -80% -100%

16 PE / VC Environment improvement 6. Entreprenurial opportunities 1. Economic Activity Capital Market 20.0% 18.0% 16.0% 14.0% Evolution of Returns Fondo de Fondos (IRR in dollars) 13.5% 17.10% 5. Human and social enviroment 3. Taxaction 12.0% 10.0% 8.0% 8.4% 10.0% 6.0% 4. Investor protection and Corporate Governance México 2014 USA Brasil China México 2008 Latinoamerica 4.0% 2.0% 0.0% Source: CMIC Source : The Global Venture Capital and Private Equity Country Attractiveness Index 2014, Ernst and Young. 16

17 Our reporting model FONDO FUND (Fecha ( Date primer of first cierre closing vencimiento) Maturity) % FdeF participación % of participation del FdeF 1 - VALUACIÓN 2 - ESTADISTICAS Tir Hist 14% Tir Hist 14% $196,350 $132,777 Return Thesis Administration Batting Score Retorno Tesis Admon % de Bateo 80% 80% $7,122,413 $7,451,540 FMV 2013-I Llamados Dist Plusval Minusval FMV 2013-II Plusvalía derivada principalmente al incremento de valuación de Empresa 5 en $ 1,980 MDD que se compensa con lafund minusvalía performance de Empresa 3 en comment $ MDD. Las demás Cías presentan ligero cambio en su valuación. Commitment Capital Calls Distributions Distributions + FMV Comprometido 6,865,385 Aportado 6,328,189 Distribuido 3,055, x Distribuido + FMV 10,506, x 3 PORTAFOLIO (MDD) Fondo Part. Fecha Costo FMV +/- valía Múlt. Comentarios de País dic-12 entrada Total Rem. + dist. T-1 Total Plusvalías/Minusvalías Empresa 1 - SAPI 2% Dec-07 MEX % 2.5x Aumento en ventas y EBITDA. Entrada de dos nuevos inversionistas en colocación Company primaria y performance secundaria (con descuento). comment Decidieron no salir. Empresa 2 - SAPI 20% Jun-08 MEX % 2.1x Valor Presente de la fórmula de salida considerado situación de la Cía. Empresa 3 47% Mar-09 MEX % 0.5x Castigo en valuación por ventas mínimas y EBITDA negativo. Empresa 4 - SAPI 34% Feb-10 MEX % 1.3x Valor Presente de la fórmula de salida considerado situación de la Cía. Empresa 5 - SAPI 25% May-10 MEX % 3.0x Aumento en ventas y EBITDA. Adquisición de 16 pantallas digitales publicitarias. Total Fondo % 2.0x Investors get reliable and on time information each quarter

18 Our Benchmark model Fondo de Fondos created its own benchmark system, going ahead of global best practices 10 QUARTER Benchmark Etapa dic-2014 Grade 9 8 Return Investment thesis Reports Diversification Return variables Average, 6.39 Median, variables considered Average, 7.71 Median, 8.19 Quality Variables With more than 7 years of investment operations, Fondo de Fondos is one of the most experienced investor in Mexico and LatAm Private Equity industry

19 INSURGENTES SUR 863 PISO 11-1 COL. NÁPOLES, C.P t (55) f (55)