Apax Global Alpha Limited has announced a new capital allocation policy, effective immediately. The key highlights of the new framework include the creation of a Distribution Pool for share buybacks, allocation of 100% of "Excess Cash Flow" to the Distribution Pool until its size reaches 5% of the Company's Net Asset Value, seeding the Distribution Pool with €30m, and continued payment of regular dividends to shareholders semi-annually. The new framework aims to maximize returns for shareholders across economic cycles while prudently managing the company's financial position.
The Board believes that the current discount to NAV presents an attractive opportunity for the company to create immediate value for shareholders by investing in its own shares. As such, a Share Buyback Programme has been authorized to commence immediately. The new, flexible framework gives the Board the tools it needs to allocate capital effectively for the benefit of shareholders while ensuring the company continues to grow over time through investments in its Private Equity portfolio.
The new capital allocation framework will be implemented without compromising the company's investment strategy, portfolio composition, or balance sheet. The Board will create a Distribution Pool which earmarks funds on the company's balance sheet available for share buybacks. The Board intends to allocate 100% of "Excess Cash Flow" to this Distribution Pool until the size of the Distribution Pool reaches 5% of the Company's NAV.
In addition to share buybacks, the company will continue to pay regular dividends to shareholders semi-annually, with the dividend being set at an absolute level of 11p per share per annum. The share repurchases will be conducted within the limits approved by shareholders at the Company's Annual General Meetings. An update on the new capital allocation framework will be presented at the Capital Markets Day due to be held today at 15:00 UK.