The investment strategy of King Capital Investments is to focus primarily on private mid-market businesses, thereby leveraging the investment experience of out team with the objective of delivering long term capital appreciation within King Capital Investments in line with a gross IRR in excess of 25% per annum and a blended gross multiple of three times.
King Capital Investments focus is on investments with an enterprise value of approximately $1 to $100 million per transaction that enable it to secure a controlling position in the target company. It seeks to invest in companies that have achieved, or have the potential to achieve, a critical scale in their industry or sector, creating a sustainable earnings stream which should command a premium.
King Capital Investments typically invest in sectors that are growing or where consolidation is taking place. Within its core sector interests it invests in both performing and under-performing companies, supporting buy and build strategies or rapid growth, or businesses undergoing significant operational or strategic change. Investing in a diverse range of portfolio companies, King Capital Investments’ objective is to work proactively with investee management teams, together with other stakeholders, in order to create substantial shareholder value.
King Capital Investments generally invests in situations outside of those which appeal to the mainstream private equity community. Its deals are often particularly challenging or complex and are therefore unlikely to appeal to mainstream investors.
King Capital Investments carries out or is in a position to do the following deals:
- Challenging or complex management buyouts and buy-ins
- Public to private transactions
- Operational turnarounds and financial restructurings
- Secondary buyouts
- Later stage development capital
King Capital Investments looks for businesses where the Investment Adviser’s team can make a difference. The Investment Adviser’s senior team members include proven business leaders who have successfully run, transformed and grown businesses themselves.
King Capital Investments is relatively sector agnostic but typically invests in sectors that are growing and / or consolidating and has invested across a wide range of sectors to date.
The Investment Adviser’s team are used to executing deals in relatively short and demanding timescales, where the circumstances of the business or the situation demand it.
King Capital Investments’ targeted investment size is from $1million to $100million. King Capital Investments seeks to take controlling equity positions, but can also invest in other parts of the capital structure, including mezzanine and senior debt in support of equity led transactions.
Investments in listed securities, markets or situations are limited to no more than 15% of the public or listed securities in any target company except where such acquisition forms part of a takeover offer.
King Capital Investments adheres to a strict set of procedures when implementing its investment strategy. These procedures emphasize:
- Concentration on a select number of investments;
- In depth analysis of the industry sector and the company prior to acquisition;
- Focus on cash flow stability and growth prospects; and
- A hands-on, value creating approach to ownership.
The overriding philosophy behind each investment is to achieve capital appreciation through EBITDA growth, primarily driven by revenue increases, achieved both organically and by acquisition. Typically, the Investment Adviser would expect portfolio companies to double EBITDA within three to five years after investment.