JZ Capital Partners Ltd – Secondary Sale and Monthly Net Asset Value Update

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JZ CAPITAL PARTNERS LIMITED (the “Company” or “JZCP”)
(a closed-end investment company incorporated with limited liability under the laws of Guernsey with registration number 48761)
LEI code 549300TZCK08Q16HHU44

Additional update regarding secondary sale and

Monthly net asset value

June 23, 2022

Secondary sale

JZ Capital Partners Limited, the London listed fund that holds investments in U.S. and European microcap companies and U.S. real estate, is pleased to provide a further update regarding its holding in the secondary fund, JZHL Secondary Fund LP and its announcement made on May 23, 2022.

In this announcement, the Company provided an update indicating that a holding company of the Secondary Fund had entered into an agreement to sell certain of its interests, the completion of the sale being subject to the satisfaction of certain conditions, including the federal Hart-Scott-Rodino Act pre-merger notification program. The sale involved the disposal of a portion of the Secondary Fund’s interest in the holding company, Testing Services Holdings, and the Company is now pleased to report that the conditions of the sale have been satisfied and the sale is complete. As a result, the Company received a secondary fund distribution of approximately $96.2 million.

The sale of part of Testing Services Holdings and the resulting distribution received by the Company corresponds to an increase in net asset value for JZCP of approximately 59 cents per Ordinary Share of the Company on the basis of April 30, 2022 valuation and about 70 cents elevation from the February 28, 2022 valuation reflected in the Company’s annual results. In addition and as previously announced, the Company having now received this distribution should be able to fund its obligation to redeem its zero-dividend preferred shares due on October 1, 2022subject to compliance with the financial covenants of the Company’s senior facility provided by WhiteHorse Capital Management, LLC, due on January 26, 2027 and the extension of the maturity of the Subordinated Notes made available by Jay Jordan and David Zalaznick (and their affiliates) due on September 11, 2022. It had previously been indicated that when the Company has sufficient cash to redeem the zero-dividend preferred shares, such an extension would be negotiated and, therefore, the Company intends to seek to negotiate such an extension until maturity of the Subordinated Notes.

JZCP’s remaining stake in the secondary fund, after completion of the sale of part of Testing Services Holdings, is valued at approximately $75.4 million. As previously announced, the Company will also make further announcements regarding any further distributions from the Secondary Fund (and in particular regarding any distributions resulting from its participation in the Secondary Fund) as appropriate and once further information becomes available for this .

Monthly Net Asset Value (“NAV”)

The unaudited Net Asset Value per Ordinary Share of the Company at the close of business on May 31, 2022 was the following:

Company Name Date NAV per Ordinary Share
JZ Capital Partners Limited May 31, 2022 $4.85

NAV from JZCP to May 31, 2022 is $4.85 per Ordinary Share ($4.36 per ordinary share at April 30, 2022), the increase in the ANR of 49 cents per Ordinary Share is due to net investment gains of 48 cents (59 cents Secondary fund increase less 11 cents other portfolio write-downs), investment income of 1 pennynet foreign exchange gains of 2 cents compensated by the charges and financial charges of (2) pennies.

Below is a summary of the Company’s assets and liabilities as of May 31, 2022together with a pro forma summary thereof to June 23, 2022 which includes the distribution described above received by the Company from the Secondary Fund. Like a June 23, 2022the Company has cash and cash equivalents of approximately US$136 million.

Pro forma
(including secondary fund distribution)
31.5.2022 23.6.2022
‘000 USD ‘000 USD
Assets
Private investments 483 289 387 132
Cash and cash equivalents 40,334 136,491
Other receivables ten ten
Total assets 523 633 523 633
Passives
Senior debt – due January 26, 2027 42,687 42,687
ZDP shares – maturity date 1 October 2022 71,385 71,385
Loan securities – maturity September 12, 2022 31,824 31,824
Other liabilities 2014 2014
Total responsibilities 147,910 147,910
Net asset value 375,723 375,723
Number of Ordinary Shares outstanding 77,477,214 77,477,214
Net Asset Value per Ordinary Share $4.85 $4.85

Unless otherwise defined herein, capitalized terms used in this press release have the meaning given to them in the Company’s press releases dated May 23, 2022 and April 7, 2022 (if applicable).

_________________________________________________________________________________________

For more information:

Kit Dunford / Ed Berry
FTI Council
+44 (0)7717 417 038 / +44 (0)7703 330 199
David Zalaznick
Jordan/Zalaznick Advisers, Inc.
+1 (212) 485 9410
Sam Walden / Martin Chapman
Northern Trust International Fund Administration Services (Guernsey) Limited
+44 (0) 1481 745385 / +44 (0)1481 745183

Important Notice

This announcement includes statements that are, or may be deemed to be, “forward-looking statements.” These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes”, “estimates”, “anticipates”, “expects”, “intends”, “may”. , “will” or “should” or, in each case, their negative or other variations or comparable terminology. These forward-looking statements relate to matters that are not historical facts. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance. Actual investment performance, results of operations, financial condition , liquidity, policies and development of its strategies of the Company may differ materially from the impression created by the forward-looking statements contained in this announcement. this. Furthermore, even if the investment performance, results of operations, financial condition, liquidity and policies of the Company and the development of its strategies are consistent with the forward-looking statements contained in this announcement, such results or developments may not not be indicative of results or developments in subsequent periods. These forward-looking statements speak only as of the date of this announcement. Subject to their legal and regulatory obligations, the Company, Jordan/Zalaznick Advisers, Inc. and their respective affiliates expressly disclaim any obligation to update, review or revise any forward-looking statements contained herein, whether whether or not it reflects any change in expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based or as a result of new information, future developments or otherwise.


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