Apax Partners Pay Falls by 22 Percent as Exit Values Fall

Apax Partners LLP, one of Europe’s biggest private-equity firms, paid its employee owners 19 percent less in the last fiscal year after it made fewer profitable asset sales.

Profit available to members of the partnership fell to 87 million pounds from 107.9 million pounds in fiscal 2012, according to filings at the U.K.’s Companies House. Revenue from continuing operations for the year ended in March was 165.2 million pounds, down from 213 million pounds the previous year.

The largest single payment made to any partner fell to 9.8 million pounds ($15 million) from 12.7 million pounds last year, the filings show. The recipient this year was Chief Executive Officer Martin Halusa, according to a person with knowledge of the matter, who asked not to be identified because the information is private.

The London-based firm, which owns the Cole Haan shoe brand, raised less money than it sought for its latest fund and has cut staff and closed offices as part of a restructuring. Money-losing investments during the year included Marken, a U.K.-based specialty shipping company for the drug industry. Apax lost control of Marken to its lenders in December.

Among profitable disposals, Apax sold a stake in Michigan-based software company Plex Systems Inc., making 3.6 times its original investment, while the disposal of its stake in Atlanta-based tea retailer Teavana Holdings Inc. to Starbucks Corp. returned almost 14 times the firm’s outlay, the person said.

Closing Offices

In March, Apax closed its offices in Italy and Spain and reduced the size of its investment team by about 10 percent, according to two people who asked not to be identified. Apax plans to open a new office in Brazil this year, they said.

Apax raised 5.8 billion euros ($7.5 billion) for its eighth fund in June, missing its 9-billion-euro target.

Revenue at Apax is drawn from a combination of fee income charged to investors for the funds it manages and the profits it receives from selling companies. Private-equity firms typically pool money from pension plans and endowments with a mandate to buy companies within five to six years, then sell them and return the money and a profit after 10 years. The firms usually charge a management fee of as much as 2 percent and keep 20 percent of the profits from investments.

Before it's here, it's on the Bloomberg Terminal.