LONDON (ShareCast) - (Sharecast News) - Petershill Partners announced on Thursday that it has completed the sale of the majority of its stake in General Catalyst for a nominal consideration of $726m, representing a 62% premium to the $447m carrying value of the disposed interests as of 30 June 2024.
The FTSE 250 company said the sale, arising from General Catalyst's capital restructuring, was made as part of its focus on aligning investments with its alternative asset management strategy.

It said the disposed assets included interests in General Catalyst's management fee earnings (FRE) and future performance-related earnings (PRE).

Petershill said it retained rights to PRE and balance sheet assets tied to existing funds, valued at $137m as of mid-2024, which would be realised over time.

The $726m sale consideration was structured as interest-bearing loan notes with a 10% annual interest rate.

Of that, $207m was expected to be repaid in cash by 31 March, while the remaining $519m would be repaid over time.

The transaction was equivalent to 21% of Petershill's market capitalisation as of 15 January, and would reduce 2025 distributable earnings by about 9%, primarily from a decline in Partner Fee-related earnings.

Petershill said it planned to retain most of the proceeds for reinvestment, but would declare a special dividend of 14 cents per share, amounting to $151m, returning the majority of net gains to shareholders after taxes and fees.

Timing for the special dividend would be announced after the initial loan repayment, expected by the end of the first quarter.

The transaction carried a blended discount rate of 11% on exit versus 17% at holding valuation.

Including the sale, the firm said it had generated $1.3bn in nominal consideration from stake disposals in 2024, achieving a 40% premium on carrying values.

Petershill said it retained a diversified portfolio, with its top five partner firms by ownership-weighted assets under management unchanged following the disposal.

"This transaction further demonstrates our ability to realise assets at attractive valuations relative to their holding values and allows us to exit the investment while facilitating General Catalyst's vision of building a global investment and transformation company over time," said Ali Raissi-Dehkordy and Robert Hamilton Kelly, co-heads of the Petershill business within Goldman Sachs Asset & Wealth Management in a joint statement.

"General Catalyst is an exceptional firm, and Petershill Partners and General Catalyst have benefitted from seven years of collaboration and growth.

"We wish them every success as they continue to execute on their business plan, support innovative founders and drive future global transformation.

"We see good opportunities to redeploy the retained proceeds from the sale into new investments that will drive attractive future returns for shareholders."

At 1007 GMT, shares in Petershill Partners were up 4.05% at 269.5p.

Reporting by Josh White for Sharecast.com.

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