IDI exemplifies a conservative approach to leverage, a rarity among private equity peers, by not recurring to debt at the holding company level in order to fund its acquisitions. It also monitors judiciously the leverage ratios of its portfolio companies, standing at a prudent 2.6x net debt/EBITDA at the close of 2020, compared to an average of 5.8x for European PE-sponsored deals last year. It is important to note that, even in the case that one of the participations runs into difficulties, the holdings are siloed so as to not impact any of the other assets nor IDI itself.
The company made use of a single €15m credit facility at the end of 2020. Overall, gross debt on the consolidated accounts amounted to €86.1m at the end of June 2021 (it stood at €129.5m at close of 2020), but this mainly corresponds to intra-group current accounts and a small portion in uncalled capital commitments on the IDI Emerging Markets funds. IDI maintains a net cash position, and held €184.5m in cash and liquid assets in H1 21, increasing from €123m in December 2020.
As part of its investment strategy, IDI maintains a healthy level of liquid assets as a percentage of the total portfolio, averaging c.20% historically (23% in 2020, down from 27% in 2019).
