Altamir - Registration Document 2016

1

FINANCIAL AND LEGAL INFORMATION

Business description

Evaluating potential transactions Once investment opportunities are identified, preparatory work begins, as determined by the head of the investment team. This first phase is intended to rapidly determine whether the transaction would be in line with the strategy and investment criteria of the funds as well as the priority and resources that should be devoted to it. At the conclusionof this phase, either the transaction is rejectedor adocument is preparedcontaining informationmaking it possible to validate that the transaction corresponds in principle to the investment strategy and including a recommended investment size and approach (due diligence, negotiations, structured transaction, etc.). This document is presented anddiscussed at theweekly partners’ meeting and results in a decision to pursue the transaction or not. If necessary, it also gives rise to an expansion in the investment teamanda change in the compositionof theApproval Committee that will track the investment process. The Approval Committee, in collaboration with the investment teams, ensures that due diligence is properly carried out and that favourable terms have been negotiated for each transaction before an investment decision is taken. As a rule, the investment teams use of a number of external advisory firms toundertake studies andduediligenceprocedures: on themarkets and thecompetitivepositioningof theCompany; validating business plan assumptions; validating the accountingand financial positionof theCompany (net value, debt level, earnings quality and recurrence); on legal, social andenvironmental risks, and insurance coverage; on the skills of the target company’s staff. Valuation studies are undertaken with the support of specialist banks, and joint research on suitable financing, notably for LBOs, is carried out with the partner banks. Finally, the services of prominent lawyers are essential to draft the numerous legal documents required ( e.g. share purchase agreement, shareholders’ agreement, and contracts with the management team on the remuneration and incentive packages). Asummary report on the benefits, or otherwise, of the acquisition ispresentedby the investment teamto the InvestmentCommittee, which thendecideswhether or not toproceedwith theacquisition. A rigorous system for delegating authority is put in place for each stage of the process.

MONITORING INVESTMENTS

For each new investment, a value creation plan is defined and shared with the Company’s management team who will be responsible for implementing the plan. The investment teammonitors the companies in the portfolio on both operational and financial levels. The team meets regularly with the management of each company in the portfolio during Board meetings or operational review meetings. Tomonitor the potential, growth and valuation trends of portfolio companies, Apax Partners LLP’s three cross-functional teams (Operational Excellence, Digital andCapital Markets) canbe called upon to bolster and optimise value creation for a given company. These three teams, which are comprised of experts from various technical fields, are ready to help and guide the management teams of the portfolio companies to create value through specific projects. Amonthly report on themain financial and operational indicators for all of the portfolio companies is reviewed by the partners. The investment team in charge of each company in the portfolio prepares a report that serves as a basis for the Monitoring Committee meetings. The Committee meets throughout the investment period. It reviews the post-acquisition plan and assesses the progress made since the investment date. In addition, all of the partners perform a complete portfolio review twice a year. The objective of this review is to update the information on each investment aswell as the expectedmultiples and IRRs for each company in the portfolio. These updated projections are then included in a performance report that serves as aguide formanaging theoverall performanceof ApaxPartners. Apax Partners has also implemented a set of administrative and internal control procedures used to track, verify, manage and document all financial and administrative transactions related to the investments and to management of the funds. The assets in the funds are valued according to the principles described in the notes to the consolidated financial statements.

50 REGISTRATION DOCUMENT 1 ALTAMIR 2016

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