Investors have been understandably skittish around private equity in the past year, doubting the accuracy of self-administered asset valuations and fearing the sector would struggle in a high-rate and potentially recessionary environment. Oakley Capital Investments (OCI) continued to deliver the goods in 2022 and looks well positioned to cope with a difficult macro backdrop.
- Focus on platforms with sticky revenues
- A top performer among peers
- Big discount to NAV
- Excellent ‘buy and build’ track record
- Concentration risk
- Difficult environment for private equity
The trust, a listed vehicle that invests alongside larger funds managed by Oakley Capital, invests in a concentrated portfolio of 26 companies in the technology, education and consumer sectors, all with a focus on digitalisation. In 2022, it posted a per-share net asset value (NAV) total return of 24 per cent, around two-thirds of which was earnings growth and the rest via multiple expansion (chiefly from exits). Top contributors included IU Group, a digital university that with 100,000 students is now the biggest in Germany, and Contabo, a cloud hosting platform.