Navis seeks exits for continuation assets

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Navis is looking to unload some of its holdings in the retail business.
PETALING JAYA: Private equity firm Navis Capital Partners is looking to divest the remaining assets in its continuation fund in the next year or so, managing partner Nicholas Bloy told DealStreetAsia.
A process is already being run by Rothschild & Co for supermarket chain The Food Purveyor, which operates the Village Grocer and BIG stores in Malaysia, Bloy said.
Navis acquired a majority stake in the company in 2014, before rolling over the asset into the Navis Asia Green Loop Fund, or the S$450 million (RM1.48 billion) continuation fund closed last year. The continuation fund held five assets from the 2010-vintage Navis Asia Fund VI portfolio.
“With the continuation funds, you get a little bit more time to do things that are important that you have run out of time (for) with your previous fund,” Bloy said. “But at the end of the day, you’re still trying to move things quickly. I think in the next 18 months, we will want to have exited every deal of the continuation fund.”

Since the beginning of this year, Navis has already divested a number of portfolio companies, including from the Green Loop fund. The divestments announced this year include Singapore-based electronic waste-processing firm TES, Hong Kong footwear component company Texon, medical cold-chain solutions provider B Medical Systems and label and precision die-cut parts provider Adampak.
These assets were held in Navis Asia Fund VI and VII and the firm’s continuation vehicle, Navis Asia Green Loop Fund.
Companies that are still in the private equity firm’s holdings include Australian cafe chain Dome Coffee, in which Navis invested in 2014; restaurant businesses Imperial Treasure and Oriental Group, in which it invested in 2015 and 2016, respectively; and food processing company Godaco Seafood, which has been in the portfolio since December 2012.
Bloy acknowledged that amid the challenges in the global economic environment, people are expected to tighten their belts, which will, in turn, have an impact on consumption-driven businesses. “But if you’re buying consumer-related businesses, you buy those that have pricing power, and where there is pent-up demand. You can get through those more difficult periods quite easily,” he said.

Navis most recently invested in Thailand-based Ambassador Education, which owns and operates K-12 schools under various brands in Chiang Mai. The education group joins Navis’ portfolio of education assets in Vietnam and Cambodia.
In Bloy’s view, the education sector is primed for investment, particularly the institutions serving the increasingly affluent middle market, given the demand for education services in countries such as Thailand and Vietnam, and consequently their pricing power.
The firm is deploying from Navis Asia Fund VIII, which closed with S$900 million (RM2.9 billion) in commitments in August last year.
Navis Capital has also launched a private credit strategy, which will leverage the firm’s network in Southeast Asia to focus on opportunities in the region.
Bloy added that Navis will be more “discriminating” when it comes to new investments, and expects investors more generally to pull back from venture and growth-stage investments. “Which means fewer deals and therefore smaller dollars.”

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