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ANNUAL REPORT 2015


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ANNUAL REPORT 2015  SPICE PRIVATE EQUITY

SHARE PRICE DEVELOPMENT 2015

SPCE share price and NAV/share, 2015, USD NAV/share

share price 28

41

27

40

26

39

25

38

24

37

23

36

22

35

21

34 1 Jan 2015

1 Apr 2015

1 Jul 2015

1 Oct 2015

31 Dec 2015

USD

39.11

NAV PER SHARE 31 DECEMBER 2015

37.1 %

DISCOUNT TO NAV 31 DECEMBER 2015

THE BRIDGE TO EMERGING MARKETS. SPICE PRIVATE EQUITY PROVIDES INVESTORS WITH ACCESS TO ATTRACTIVE PRIVATE EQUITY OPPORTUNITIES IN EMERGING MARKETS.


SPICE PRIVATE EQUITY  ANNUAL REPORT 2015

CONTENTS

COMPANY PROFILE

Spice Private Equity Ltd is a Swiss investment company with an exclusive focus on private equity investments in emerging markets. Spice Private Equity Ltd has over a decade of operating history and is managed by GP Advisors part of the GP Investments Group. The company is listed on the SIX Swiss Exchange under the ticker symbol SPCE.

KEY INFORMATION AS OF 31 DECEMBER 2015

Closing price per share Net Asset Value per share Exchange rate Number of shares issued Number of shares outstanding Market capitalization

USD 24.60 USD 39.1 1 USD/CHF 0.99250 5 363 717 5 357 322 USD 131.9 million

Swiss security number ISIN Ticker symbol

915.331 CH0009153310 SPCE

Reuters Bloomberg

SPCE.BN SPCE:SW

www.spice-private-equity.com

NAME CHANGE

The Extraordinary General Meeting (EGM) on 26 February 2015 approved a name change from APEN Ltd to Spice Private Equity Ltd. Subsequently the name of APEN Bermuda EM Ltd was changed to Spice Private Equity (Bermuda) Ltd. Throughout this report the new names are used.

ROUNDING

Numbers presented throughout this report may not add up precisely to the totals provided in the tables and text. Percentages and percent changes are calculated based on figures that are not rounded and may not precisely reflect the percentages and percent changes that would be derived based on rounded figures displayed in the tables and text.

  4

Chairman’s Statement

  6

Management Report

Review of 2015 and outlook

Ten largest underlying investments

Current investments and commitments

Detailed supplementary information

27

Financial Statements (IFRS) – Spice Private Equity Ltd

55

Corporate Governance

65

Compensation Report

69

Financial Statements (Swiss law) – Spice Private Equity Ltd

76

Addresses and Contacts

3


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ANNUAL REPORT 2015  CHAIRMAN’S STATEMENT

CHAIRMAN’S STATEMENT Antonio Bonchristiano

David Emery

David Pinkerton

Fersen Lambranho

Board of Directors, from left to right: Antonio Bonchristiano, Vice Chairman – David Emery, Member Eduardo Leemann, Chairman of the Board – David Pinkerton, Member – Fersen Lambranho, Member (elected by EGM on 26 February 2015, replaces Alvaro Lopes)

“2015 WAS THE FIRST YEAR IN WHICH SPICE PRIVATE EQUITY’S INVESTMENTS WERE EXCLUSIVELY CONCENTRATED ON EMERGING MARKETS.” EDUARDO LEEMANN


CHAIRMAN’S STATEMENT  ANNUAL REPORT 2015

Eduardo Leemann

Dear Shareholders, 2015 was the first year in which the Company’s private equity investments were exclusively concentrated on emerging markets. With the disposal of the legacy holdings at the end of 2014, the Company started the year debt-free and with the majority of assets available for investments. The focus for the year was to allocate capital according to the announced investment strategy. In light of the high market volatility which characterized the emerging markets throughout the year, it was decided to follow a prudent approach, concentrating on high-quality opportunities with established local partners. During the reporting period, seven transactions have been closed and USD 60.5 million have been allocated. Including open commitments, the Company has allocated 41.5 % of the available capital, leaving plenty of room for further investment opportunities. Investment performance, enhanced by the first exit of a co-investment and by secondary fund purchases at discounts, is positive: the overall Net Asset Value (“NAV”) has increased by 2.9 % which compares

positively with a strongly negative (–14.9 %) MSCI EM index. 2015 has been characterized by strong volatility in the currency markets: it started with the announcement of the Swiss National Bank in the middle of January to stop linking the CHF with the EUR. In the course of the year – and particularly in the second half – emerging-market currencies started losing value compared to the USD. This has impacted the value of the investments, but only to a limited extent, however, since the majority of assets are held in USD or have a strong USD link. Various measures have been implemented to increase the Company’s appeal to shareholders. At the beginning of the year, Spice Private Equity started reporting in USD instead of CHF, eliminating a layer of currency translation and potential currency volatility in the reported NAV. The next step was to switch the listing of the shares to USD as well (on 20 May 2015). A new corporate identity was introduced in the first half of the year, starting with a new name to position the Company more clearly. This has permitted a full overhaul on the communication side: a transparent, dynamic and easy-to-navigate website, supported by redesigned, appealing material. The frequency of information availability has also been increased with the issuance of handy monthly fact sheets starting at the end of September.

5

Despite a step up in the investor relations effort and professional market-making support from leading European broker Kepler Cheuvreux, the share price still trades at too wide a discount to NAV. While in the first half of the year the discount did narrow, in the second half, possibly also due to the general sell-off of emerging-market investments, it began to widen again. The current discount level is clearly unsatisfactory, and the Board of Directors, giving increasing priority to the topic, is currently intensively assessing options to address it. Since the resignation of Alvaro Lopez and his replacement by Fersen Lambranho (both representing GP Investments) on 26 February 2015, the Board of Directors has remained unchanged. The current members of the Board of Directors will stand for re-election at the 2016 Shareholders’ Meeting. The market environment continues to be characterized by high volatility, and we expect this to last throughout 2016. In such market conditions, it is important to maintain a disciplined investment approach: market dislocations will bring additional, high-quality assets to the market. With a strong balance sheet, Spice Private Equity is very well positioned to take advantage of such attractive future investment opportunities.

Eduardo Leemann Chairman of the Board


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ANNUAL REPORT 2015  MANAGEMENT REPORT

MANAGEMENT REPORT David Salim

Guido Cornella

Management of GP Advisors: David Salim, Chief Executive Officer and Dr. Guido Cornella, Chief Financial Officer

THE GROSS PORTFOLIO RETURN OF 35.5 % FOR THE YEAR RESULTED IN A TVPI OF 1.23X AND AN IRR OF 37.5 % SINCE INCEPTION.


MANAGEMENT REPORT  ANNUAL REPORT 2015

7

REVIEW OF 2015 AND OUTLOOK

DURING THE YEAR, SPICE PRIVATE EQUITY LTD (THE “COMPANY”) PERFORMED WELL ABOVE EXPECTATIONS FOR A COMPANY AT ITS CURRENT STAGE IN THE INVESTMENT CYCLE. THE COMPANY’S NET ASSET VALUE (“NAV”) INCREASED BY USD 1.09 PER SHARE OR 2.9 % DURING THE PERIOD, REACHING USD 39.11 PER SHARE AS OF 31 DECEMBER 2015 (31 DECEMBER 2014: USD 38.02 PER SHARE).

The driving factor for the NAV increase was the good performance of the investment portfolio, which more than offset the expenses incurred during the year. The economic NAV as of 31 December 2015 grew as well and amounted to USD 42.05 per share. The difference between the published NAV per share (USD 39.11) and the economic NAV per share relates to the accounting treatment of the “derivative financial liability” stemming from the put-call agreement in CHF (to expire on 12 June 2018) between the Company

The significant gain on the investment portfolio for the year of USD 12.0 million on starting and ending fair values of USD 16.8 million and USD 65.8 million respectively, was accomplished mainly through the initial uplift on several secondary

IRR AND TVPI, BY VINTAGE

FAIR VALUE BRIDGE, YTD

USD; in million

USD; in million 70

and Fortress entities. In line with IFRS accounting, the Company presents the put option as a liability, resulting in a charge of USD 2.94 per share for 31 December 2015 (December 2014: USD 2.94 per share).

47.7

10.6

12.0

65.8

18.3%

81.2%

1.24x

1.23x

60

IRR

60

50

50

40

40 30 20

30 16.8

10

10

0

0

Fair Value of Investment Portfolio as of 1 Jan 2015

44.1

20

Purchases & capital calls

Sales proceeds & distributions

Gross Portfolio Return

Fair Value of Investment Portfolio as of 31 Dec 2015

18.2

22.4

Paid-in*

Total value*

2014 Vintage

Paid-in*

54.0

TVPI

TVPI = Total Value to Paid In The ratio of the current value of remaining investments within a fund, plus the total value of all distributions to date, relative to the total amount of capital paid into the fund to date. * as of 31 Dec 2015

Total value*

2015 Vintage


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ANNUAL REPORT 2015  MANAGEMENT REPORT

purchases at significant discounts, and the gain on the exited Giant Interactive direct co-investment. Of the total investment program of USD 220 million, USD 91.4 million or 41.5 % has been allocated so far. Total Spice Private Equity exposure as of 31 December 2015 stands at USD 83.8 million, corresponding to 36.9 % of total assets. At year-end, the Company was debt-free. In 2015, the Company’s share price increased by 8.1 % from USD 22.75 and ended the year at USD 24.60. As of 31 December 2015, the shares traded at a discount of 37.1 % to the NAV (31 December 2014: 40.2 %). MARKETS Spice Private Equity is active at two levels in the private equity investment space: it invests directly in companies, as well as investing indirectly through fund managers. The latter approach is a combination of primary investments in blind pools and of secondary purchases of investors’ commitments in existing private equity funds. Secondary purchases are generally made in mature private equity funds, i.e. funds which have invested 50 % to 100 % of their callable capital. While the overall investment focus is on emerging markets, Spice Private Equity

concentrates its efforts on three main regions: Asia-Pacific, Sub-Saharan Africa and Latin America. The fundamental theme is to benefit from the growth of the middle class in those regions by investing mainly in manufacturing and services companies, as well as companies which are important for the development of the region. During 2015, emerging markets in general were confronted with headwinds mainly due to increased volatility and a slow-down in the growth of the Chinese economy and other regional or country-specific issues, such as the continued recession and political tensions in Brazil. Combined with the increased attractiveness of the US economy and uncertainty over the United States’ central bank’s monetary policy, this situation has provoked a shift of capital flows out of emerging markets. This creates a situation with great potential for unique investments by deploying capital with a disciplined approach. Together with established local partners, Spice Private Equity was involved in a substantial number of potential investment processes across the three main regions, closing several investments and committing to certain funds accordingly to the Company’s portfolio allocation strategy. Furthermore, Spice Private Equity has an

extensive pipeline with many situations at advanced stages, benefiting from the current market situation. ASSET ALLOCATION The investment portfolio is in a build-up phase. The total investable capital is approximately USD 220 million, although part of this amount will be received from Strategic Partners over three additional installments by the end of 2017. In order to accelerate the investment pace – and should attractive investment opportunities materialize – we have negotiated a USD 75 million revolving credit facility with a lender. The credit line is not to be seen as a leverage of the portfolio, but as an anticipation of future, predetermined cash flows. The overall goal is to fully allocate the available USD 220 million between the end of 2016 and the end of 2017. Once fully allocated, the portfolio composition will be diversified from a geographic standpoint as well as based on the type of investments. Alongside the targeted geographic focus, actual allocation is expected to be concentrated on Asia-Pacific, Sub-Saharan Africa and Latin America. Opportunistic investments in other emerging-market regions remain possible. The bulk of investments will be either direct in nature (co-investments) or in funds at an advanced stage (secondary opportunities). Primary in-

DIVERSIFICATION BY REGION

DIVERSIFICATION BY CURRENCY

Expressed as % of invested assets in underlying companies applying fair values

Expressed as % of total assets

INR 11.8 %

Other regions 0.3 % Sub-Saharan Africa 8.0 %

USD 76.1 %

BRL 8.9 % IDR 2.1 %

Asia-Pacific 56.4 %

CHF 0.1 % Others 1.1 %

Latin America 35.4 %


MANAGEMENT REPORT  ANNUAL REPORT 2015

vestments will represent a smaller portion with a strategic angle, enhancing further investment opportunities. Except for Primary Investments, investment opportunities are the result of an iterative process combining bottom-up and top-down approaches. We are seeking to develop a portfolio with good diversification from a geographic standpoint; however, if during the coming years, investment opportunities in a certain region are not sufficiently attractive and do not meet our risk/return criteria, we will adjust our geographic and type allocation to reflect prevailing market conditions. PORTFOLIO In the first full year of capital deployment following the divestment of the Legacy Portfolio in December 2014, the portfolio has continued developing across both co-investments and funds during 2015. Regarding the co-investments, new investments during 2015 were Africa Oil Corporation (upstream oil exploration in East Africa with Helios Investment Partners), Altico Capital (non-bank finance company in India with Clearwater Capital Partners) and Rede D’Or (private hospital chain in Brazil with The Carlyle Group). In the meantime, Giant Interactive, the co-investment made in 2014, has been

exited as Baring Asia, the sponsor, took advantage of a window of opportunity to divest this asset ahead of schedule, given the volatility in the Chinese market. Regarding secondaries, three transactions were completed during 2015. The first transaction was the acquisition of an interest in DLJ South America Partners; the second transaction was the portfolio acquisition of interests in GP Capital Partners IV, Magma Fund and Magma Fund II, all managed by GP Investments; and the third was the portfolio acquisition of interests in Jacob Ballas India Fund III, Tara India Fund III, GP Capital Partners IV and GP Capital Partners V. Meanwhile, the position in Quvat Capital Partners II, purchased in 2014, continues to mature as the sponsor positions the underlying investee companies towards an exit. For the primary portfolio, a commitment to Northstar Equity Partners IV was made in 2015. The Asia primary investments are developing well and now consist of Baring Asia Fund VI (two investments), Navis Asia Fund VII (five investments) and Northstar Equity Partners IV (four investments). The Africa primary investments of Helios Fund III (three investments) and Carlyle SubSaharan Africa Fund (four investments) continue to progress steadily in somewhat volatile market conditions.

FINANCIALS From an IFRS perspective, Spice Private Equity generated income of USD 7.7 million (2014: USD 1.3 million (restated)) and expenses of USD 3.1 million (2014: USD 2.9 million (restated)), resulting in a net operating profit of USD 4.6 million (2014: loss of USD 1.6 million (restated)) for the period. Charges for discontinued operations of USD –1.3 million (2014: USD 4.4 million (restated)) and currency translation differences of USD nil million (2014: USD 0.5 million (restated)) resulted in a net profit of USD 5.9 million (2014: loss of USD 5.5 million (restated)) for the period. From a fully consolidated perspective, the total expenses for the year of USD 8.7 million are split into USD 8.0 million in operating expenses and USD 0.7 million in financing expenses. USD 5.6 million of the operating expenses were incurred at the Bermuda subsidiary holding all private equity investments, while USD 2.4 million of the operating expenses were incurred at the holding company level. The above reported income and resulting net profit figures include the change in fair value of the unconsolidated subsidiary (Spice Private Equity (Bermuda) Ltd). The emerging-market investments within this subsidiary performed well, with a gross portfolio return of USD 12.0 million versus average invested capital

DIVERSIFICATION BY SECTOR

DIVERSIFICATION BY STAGE

Expressed as % of invested assets in underlying companies applying fair values

Expressed as % of invested assets in underlying companies applying fair values

Industrial 20.6 %

Leisure 10.6 % Consumer 8.4 %

Buyout 22.1 %

Services 21.9 % Energy 7.7 % Medical & Health 22.3 %

Technology 2.4 % Others 6.2 %

9

Growth 77.9 %


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ANNUAL REPORT 2015  MANAGEMENT REPORT

for the year of USD 33.7 million, resulting in a gross portfolio return of 35.5 % for the year, and contributing to an overall TVPI of 1.23x and an IRR of 37.5 % since inception. After accounting for all operating costs at subsidiary level and the holding company of USD 8.1 million, a net portfolio return of USD 3.9 million or 11.6 % on average invested capital for the year resulted. After the receipt of the first deferred payment of USD 37.4 million at the end of September 2015 stemming from the sale of the “Legacy Portfolio”, cash held across the subsidiary and the holding entity stood at USD 49.6 million as of 31 December 2015, and unfunded commitments amounted to USD 29.2 million. The previously mentioned revolving credit facility of USD 75 million is in place to potentially accelerate the investment pace but not to create leverage. The liquidity situation remains solid. Capital calls and new investments of USD 47.7 million (at cost), paid during the year, outweighed distributions for the same period, which stood at USD 10.6 million. Outstanding receivables deriving from the sale of the “Legacy Portfolio” totaling USD 112.1 million (gross of discount) will be received over the next two years in three equal installments, increasing the Company’s cash predictability.

OUTLOOK The uncertain short term outlook in the emerging markets in the initial months of 2016 reflects several factors, including lower commodity prices and tighter external financial conditions, structural bottlenecks, rebalancing in China and the economic impact of geopolitical factors. The medium to long-term outlook for emerging-market economies remains attractive given the secular growth prospects. Given the composition of our current portfolio, we expect to see some limited liquidity from our mature secondary positions in Asia. From the co-investment portfolio, we do not expect major liquidity events or divestments in the short term.

DIVERSIFICATION BY MATURITY 2)

DIVERSIFICATION BY STRATEGY 3) Direct Co-Investments 30.0 %

100 %

Fund Investments 70.0 % Primaries 6.5 %

80 %

60 %

Directs 30.0 %

40 %

Secondaries 63.5 %

20 %

0%

0–1 year

1–2 years

2–3 years

3–4 years

Defined by timing of investment by Spice Private Equity

2)

4–5 years

Expressed as % of assets in investment structure

3)


MANAGEMENT REPORT  ANNUAL REPORT 2015

TEN LARGEST UNDERLYING INVESTMENTS

Rank Company name

Fund/lead investor name

Stage

Country

Region

Sector 1)

Date of initial investment

1 Rede D’Or

The Carlyle Group

Growth

Brazil

Latin America

Medical & Health

Oct 2015

2 Altico Capital

Clearwater Capital Partners

Buyout

India

Asia-Pacific

Services

Sep 2015

3 Africa Oil Corporation 2)

Helios Investors

Growth

Kenya

Sub-Saharan Africa

Energy

Jun 2015

4 Magnesita

GP Capital Partners IV, Magma Fund I & II

Growth

Brazil

Latin America

Industrial

Apr 2015

2)

5 SRL

NYLIM Jacob Ballas III

Growth

India

Asia-Pacific

Medical & Health

Sep 2015

6 BHG

GP Capital Partners IV

Growth

Brazil

Latin America

Leisure

Apr 2015

7 Religare

NYLIM Jacob Ballas III

Growth

India

Asia-Pacific

Services

Sep 2015

8 Blitz Megaplex

Quvat Capital Partners II

Growth

Indonesia

Asia-Pacific

Leisure

Mar 2014

9 Centauro

GP Capital Partners V

Buyout

Brazil

Latin America

Consumer

Sep 2015

Quvat Capital Partners II

Growth

Indonesia

Asia-Pacific

Various

Mar 2014

10 Linq Asia Capital EVCA definition Listed

1)

2)

Aggregated fair value of ten largest underlying investments – as % of total investments – as % of total assets

THE LARGE MAJORITY OF INVESTMENTS ARE A BALANCED MIX OF DIRECT CO-INVESTMENTS AND SECONDARY FUND INVESTMENTS.

USD 41.9 million 63.7 % 18.5 %

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ANNUAL REPORT 2015  MANAGEMENT REPORT

CURRENT INVESTMENTS AND COMMITMENTS

Nairobi, Kenya


MANAGEMENT REPORT  ANNUAL REPORT 2015

13

DIRECT CO-INVESTMENTS AFRICA OIL CORPORATION Spice Private Equity has co-invested with Helios Investment Partners (“Helios”) to acquire a significant minority stake in Africa Oil Corporation (“AOC”), an upstream E & P company in East Africa. Total Spice Private Equity contribution was USD 5.0 million. AOC is a pioneering East African focused oil company with a footprint covering seven oil blocks across Kenya and Ethiopia, core target regions of Spice Private Equity investment strategy. AOC has a dual listing in the Toronto and Nasdaq Stockholm stock exchanges.

Nairobi, Kenya

All involved partners have long standing track records in the region and in the industry. Helios is one of the most reputable private equity managers in Africa and has extensive experience with energy and particularly oil related transactions in the region. AOC’s management team is highly experienced and is backed by the Lundin Group, a successful investor in the sector and in the region. AOC’s operating partner is Tullow, a leading E & P group with worldwide operations and long standing presence in Africa. By investing through a structured transaction at an attractive part of the economic cycle, characterized by historically low oil prices, Spice Private Equity is entering a key industry for the region’s development. www.africaoilcorp.com

ALTICO CAPITAL Spice Private Equity has entered into a co-investment with Clearwater Capital Partners (“Clearwater”) in Altico Capital India Private Limited (“Altico Capital”), a Non Bank Finance Company (“NBFC”) based in Mumbai India. Total Spice Private Equity commitment to Altico Capital is USD 10.0 million. Altico Capital is a direct co-investment in an Indian Non Bank Finance Company (“NBFC”) originally established and managed by Clearwater. Other co-investors include Värde Partners, the Minneapolis based multi-billion dollar global alternative investment firm, and the Abu Dhabi Investment Council. NBFCs have taken an increasing role in filling the credit void Mumbai, India created by the traditional Indian banks in the financing landscape. Altico Capital was established to capitalize on direct lending opportunities in India, with the focus on making senior secured loans in the real estate sector whilst retaining the flexibility to invest across multiple strategies. Founded in 2001, Clearwater Capital Partners invests in credit and special situations across Asia. Since inception, Clearwater has invested more than USD 4 billion in the Asia region and currently manages approximately USD 1.5 billion of assets across six funds. Clearwater Capital Partners is headquartered in Hong Kong and has a multi-disciplinary team across six offices located throughout Asia.


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ANNUAL REPORT 2015  MANAGEMENT REPORT

REDE D’OR SÃO LUIZ Spice Private Equity has co-invested with The Carlyle Group to acquire a minority stake in Rede D’Or São Luiz (“Rede D’Or”), the largest private hospital operator in Brazil. Spice Private Equity’s total commitment in this investment was USD 11.0 million. Rede D’Or São Luiz (“Rede D’Or”) is a direct co-investment in the largest private hospital operator in Brazil. Rede D’Or has more than 4,600 beds in 28 owned and two managed hospitals, in addition to 30 oncology clinics, with a presence in various regions throughout Brazil. São Paulo, Brazil

The company is uniquely positioned to expand and strengthen its platform as a leading company in the Brazilian healthcare market. This investment represents a defensive play in a domestic sector with strong growth potential and good fundamentals. The co-investment opportunity is led by The Carlyle Group. The investment in Rede D’Or gives Spice Private Equity access to one of the dominant participants in an attractive, growing market.

WITH OUR NETWORK AND OUR EXPERTISE WE BRING TOGETHER THE CAPITAL NEEDS IN EMERGING MARKETS AND THE CAPITAL RESOURCES OF OUR GLOBAL INVESTORS.


MANAGEMENT REPORT  ANNUAL REPORT 2015

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FUND INVESTMENTS SECONDARY FUND INVESTMENTS DLJ SOUTH AMERICA PARTNERS Spice Private Equity acquired through a secondary transaction an LP stake in DLJ South America Partners, a private equity fund managed by Victoria Capital Partners. Victoria Capital Partners was formed in 2006 through the spinoff of DLJ South America Partners from Credit Suisse and has capital commitments of over USD 1.7 billion in aggregate. Victoria Capital Partners is currently comprised of 14 investment professionals in three regional offices in South America: Buenos Aires (Argentina), São Paulo (Brazil) and Bogotá (Colombia).

São Paulo, Brasil

DLJ South America Partners is a 2007 vintage fund with total commitments of approximately USD 300 million. The fund has been highly successful and still holds a quality portfolio which should create further substantial upside. The four portfolio companies operate in the financial services, healthcare and consumer industries. The investment represented a further step in the implementation of Spice Private Equity’s overall emerging markets strategy and is the first investment in Latin America since the strategic repositioning of the Company. The opportunity has been proprietarily sourced. www.victoriacp.com

GLOBAL EM PORTFOLIO I Spice Private Equity has completed a secondary transaction, acquiring LP interests in NYLIM Jacob Ballas India Fund III, LLC, Tara India Fund III, LLC, GP Capital Partners IV, L.P., and GP Capital Partners V, L.P. The total private equity exposure acquired is USD 21.0 million. NYLIM Jacob Ballas India Fund III, LLC, (“Fund III”) is a 2008 vintage fund with USD 439 million total commitments and managed by NYLIM Jacob Ballas Asset Management Company III, LLC (“AMC”), a Mauritius company. Tara India Fund III, LLC is a 2008 vintage fund with USD 225 million total commitments and managed by IL & FS Investment Managers Limited (“IIML”), the private equity arm of IL & FS. GP Capital Partners IV is a 2007 vintage partnership with total commitments of approximately USD 1.27 billion and managed by GP Investments, Ltd. GP Capital Partners V is a 2008 vintage partnership with total commitments of approximately USD 1.05 billion and managed by GP Investments, Ltd. This secondary transaction represented a further step in the implementation of Spice Private Equity’s overall emerging markets strategy adding established GPs to the portfolio and increasing the allocation to secondary transactions in Asia and Latin America. New Delhi, India


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ANNUAL REPORT 2015  MANAGEMENT REPORT

LATAM PORTFOLIO 1 Through a secondary transaction bidding process, Spice Private Equity acquired from a third party, LP stakes in GP Capital Partners IV, Magma Fund and Magma Fund II, a portfolio of private equity investments managed by GP Investments.

São Paulo, Brasil

GP Capital Partners IV is a 2007 vintage fund with total commitments of approximately USD 1.27 billion. The fund still holds three investments with substantial upside potential. The three portfolio companies operate in the refractory mining and products, hospitality and business services sectors. Magma Fund and Magma Fund II are two funds set-up for the investment in a refractory mining and products company in Brazil (also present in GP Capital Partners IV).

GP Investments is a Latin American diversified asset management company with private equity investments focused on the acquisition of companies with high potential for value creation (total USD 3.5 billion invested in PE since 1993). GP Investments is also the largest shareholder in Spice Private Equity and the parent company of GP Advisors, Spice Private Equity’s investment manager. The investment represents a further step in the implementation of Spice Private Equity’s overall emerging markets strategy adding an established GP to the portfolio and increasing the proportion of Latin American secondary transactions.

QUVAT CAPITAL PARTNER II Through a secondary transaction, Spice Private Equity acquired a LP stake in Quvat Capital Partners II, a private equity fund managed by Quvat, a leading Indonesian private equity fund manager with a deep local network. The fund is a 2007 vintage with more than USD 200 million of capital commitment. The twelve portfolio companies operate in a broad array of industries including financial services, entertainment, mining, logistics and real estate. The assets are mostly based in Indonesia with some exposure to neighboring countries such as Singapore and Malaysia. Jakarta, Indonesia

The investment represented an opportunity to purchase a mature fund position at an attractive price. It provides exposure to a diversified portfolio of companies in Indonesia, which is one of the largest countries in the world in terms of population and GDP and one with the highest GDP growth expectations. Quvat Capital Partner II is fully invested and out of its investment period. www.quvat.com


MANAGEMENT REPORT  ANNUAL REPORT 2015

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FUND INVESTMENTS PRIMARY FUND INVESTMENTS BARING ASIA FUND VI Baring Asia is a highly experienced pan-Asia private equity manager, having raised and invested USD 5 billion across five funds. Baring Asia Fund VI had raised close to its hard cap of USD 3.85 billion. Established in 1997, Baring Asia has depth of presence in the region with seven offices and over 100 professionals in its team. Baring Asia seeks to make both control and significant minority investments in high-growth companies on a country Hong Kong, China and pan-regional basis. Asia has favorable macro-economic and demographic trends, as well as the increase in the purchasing power of the growing middle class. The manager seeks to take advantage of these favorable tailwinds by leveraging its cross-border network and the collective knowledge of its team to facilitate the growth of its portfolio companies. These themes resonate and are consistent with Spice Private Equity’s investment thesis of tapping into the growth of the middle class. Baring Asia’s coverage and fund size dovetails well with Navis Fund VII, which is primarily focused on Southeast Asia. Furthermore, Spice Private Equity has already completed one co-investment with Baring Asia in Giant Interactive. As of 31 December 2015 Baring Asia Fund VI has made two investments. www.bpeasia.com

CARLYLE SUB-SAHARAN AFRICA FUND Carlyle has established an experienced team comprised of African nationals with many years of combined experience; it has offices in Johannesburg, South Africa and Lagos, Nigeria. The fund has closed at approximately USD 690 million. Carlyle targets both control investments and minority investments and employs a thematic investment process focused on sectors with high growth potential, low cost production advantages, low penetration, and those that are undergoing liberalization. The fund has a pan-regional focus and should deploy capital across the Sub-Saharan Africa region (“SSA”). Johannesburg, South Africa

The investment fits Spice Private Equity in terms of diversification and size. SSA presents a highly compelling market opportunity based on its accelerating and diversified economic growth, favorable demographics, urbanization trends, improving macroeconomic environment and political stability. Additionally, the private equity industry is still underpenetrated with total deals in 2013 representing only 0.2 % of GDP according to EMPEA. SSA attracts a fraction of the world’s private equity capital compared with other emerging regions. As of

31 December 2015, Carlyle Sub-Saharan Africa Fund holds four investments. www.carlyle.com


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ANNUAL REPORT 2015  MANAGEMENT REPORT

HELIOS FUND III Helios Investment Partners (“Helios”) is one of the leading private equity managers in Africa. The team has raised its third fund of approximately USD 1.1 billion, which is the first Africa-focused private equity fund with more than one billion dollars in capital. Established in 2004, the firm has offices in London, Lagos, and Nairobi, and a team of over 25 professionals. It has completed investments in the region’s most significant countries, including Nigeria, Ghana, Kenya, Tanzania, Angola, South Africa and Morocco. Helios is complementary to Spice Private Equity’s commitment to Carlyle Sub-Saharan Africa Fund. The fund will Nairobi, Kenya target growth equity investments in sectors exhibiting high growth potential and acquisitions of large, established businesses. The manager has deep local and international networks, a breadth of private equity transaction expertise, and a high degree of hands-on operational involvement. This positions Helios to generate strong, risk-adjusted returns from investments in the African market. As of 31 December 2015, Helios has made three investment through Fund III. www.heliosinvestment.com

NAVIS ASIA FUND VII Navis is one of the leading private equity managers in Southeast Asia with a large and institutional team. Founded in 1998, Navis manages over USD 5 billion of capital commitments with almost 100 employees spread over eight offices in Asia. Navis Asia Fund VII has closed at approximately USD 1.4 billion. Navis has an investment strategy focused on control buyouts with minimal leverage in high growth companies in a region dominated by minority growth capital investments. Its geographic focus is primarily on South and Southeast Asia, which has one of the most attractive macroeconomic growth and demographic trends going forward.

Kuala Lumpur, Malaysia

The investment in Navis fits well with Spice Private Equity’s portfolio strategy in terms of geography, industry diversification and size. It represents a good complementary fit to the commitment in Baring Asia VI in both geographic coverage and investment size. As of 31 December 2015, Navis Asia Fund VII has made five investments. www.naviscapital.net


MANAGEMENT REPORT  ANNUAL REPORT 2015

19

NORTHSTAR EQUITY PARTNERS IV The Northstar Group (“Northstar”) is a Singapore headquartered private equity firm managing more than USD 2.1 billion in committed equity capital dedicated to investing in growth companies in Indonesia and to a lesser extent, other countries in Southeast Asia. Since its founding in 2003, Northstar has raised five private equity funds and invested in more than 30 companies across the banking, insurance, consumer/retail, oil and gas, coal and mining services, telecom, and agribusiness sectors. Northstar’s newest fund, Northstar Equity Partners IV Limited (“Northstar IV”) has recently closed with USD 810 million of committed equity capital.

Jakarta, Indonesia

The investment fits Spice Private Equity’s portfolio strategy in terms of geography, industry diversification and size. Indonesia presents a highly compelling market opportunity based on the accelerating and diversified economic growth, favorable demographics, improving macroeconomic environment and political stability. Northstar IV represents a complementary fit to the existing Asian primary commitments in Baring Asia VI and Navis Asia VII in both geographic coverage and investment size. As of 31 December 2015 Northstar IV has made four investments in Indonesia.


20

ANNUAL REPORT 2015  MANAGEMENT REPORT

IN LIGHT OF THE HIGH MARKET VOLATILITY OF EMERGING MARKETS DURING 2015 SPICE PRIVATE EQUITY FOLLOWED A PRUDENT INVESTMENT APPROACH, CONCENTRATING ON HIGH-QUALITY OPPORTUNITIES WITH ESTABLISHED LOCAL PARTNERS.


21

MANAGEMENT REPORT  ANNUAL REPORT 2015

DETAILED SUPPLEMENTARY INFORMATION ON UNCONSOLIDATED SUBSIDIARIES AND INVESTMENT PORTFOLIO As of 1 January 2014, Spice Private Equity Ltd (formerly APEN Ltd, Zug) (“the Company”) adopted the amendments to IFRS 10 Investment Entities (“the Amendment”). The adoption required the Company to fundamentally revise the presentation of its financial statements. Despite the fact that the Company has not changed its underlying business model, investment portfolio and financing arrangements, the Company was required by IFRS to discontinue consolidation of its subsidiaries. From 1 January 2014, the Company carries its immediate subsidiaries at fair value through profit or loss. As a consequence, the Company’s investment portfolio and associated financial liabilities as well as related income and expense items are merged into a single line item in the balance sheet (“unconsolidated subsidiaries at fair value through profit or loss”) and Statement of Comprehensive Income (“net change in fair value of unconsolidated subsidiaries”). More granular information about the Company’s investments and financial liabilities held, as well as related income and expense items incurred in its subsidiaries are no longer visible in the Company’s primary financial statements.

Investment Portfolio Details The business purpose of the Company is to invest solely for capital appreciation, investment income or both. Capital appreciation and investment income is driven by the Group’s investments in Fund Investments and Direct Investments held within the “Emerging Markets Portfolio”. The following table presents a summary of the Company’s investments through its subsidiary: 31 December 2015 in TUSD

Direct Investments

The additional information provided differentiates between the Company’s “Emerging Markets Portfolio” (including investments made in 2014, based on the Company’s revised investment strategy) and the holding structure where applicable.

20 001

Funds

45 823

Total Spice Private Equity Group investments

65 824

Cash Other assets Other liabilities Total fair value of subsidiary

31 December 2014 (restated) in TUSD

The Company has included detailed financial information related to its underlying investments, associated financial liabilities, income and expense items and cash flows in this Supplementary Information section.

Emerging Markets Portfolio

11 927 – (47) 77 705

Emerging Markets Portfolio

Direct Investments

7 539

Funds

9 228

Total Spice Private Equity Group investments

16 767

Cash

14 359

Other assets Other liabilities Total Fair Value of subsidiary

– (119) 31 007

The “Holding Structure” as defined here encompasses the legal entity Spice Private Equity Ltd.

During 2015, USD 60.5 million have been allocated for new emerging markets investments, of which USD 47.7 million have been called and USD 12.8 million are outstanding commitments.

The “Emerging Markets Portfolio” as defined here encompasses the legal entity Spice Private Equity (Bermuda) Ltd and the entirety of the investment portfolio held by it.

Please see the table on pages 24 to 25 which presents the detailed information in relation to Spice Private Equity’s investment portfolio.


22

ANNUAL REPORT 2015  MANAGEMENT REPORT

Leverage Ratios by Holding Structure, Portfolio and for the Group The following reconciliation provides information on the allocation of investments, net cash and borowings of Spice Private Equity Group to provide information on leverage. Leverage ratio is defined as ratio between borrowings and the sum of investments and current assets (net).

Profit and Loss by Holding Structure, Portfolio and for the Group The following table summarizes the actual income and expense items incurred at holding structure, portfolio level and for the Group.

1 January – 31 December 2015 in TUSD

Interest and dividend income Net realized gain on investments

31 December 2015 in TUSD

Holding Structure

Emerging Markets Portfolio

Investments

65 824

65 824

37 718

11 927

49 645

492

492

Other liabilities 1)

(1 835)

(47)

(1 881)

Finance costs

Net cash

36 376

11 881

48 256

29 160

29 160

Cash Other assets

Outstanding commitments Receivables Net cash and receivables

Spice Private Equity Group

111 186

111 186

147 562

11 881

159 442

Net unrealized gain on investments Total income Management and administration fees

Borrowings Leverage ratio

147 562

77 705

225 267

0.0 %

0.0 %

0.0 %

Investments Cash

Holding Structure

Emerging Markets Portfolio

9 564 12 892

(103)

(5 376)

(5 478)

(234)

(2 574)

(674)

(674)

Total expenses

(3 116)

(5 610)

(8 726)

Profit/(loss) before FX, taxes and discontinued operations

(2 189)

6 356

4 166

58

342

400

Discontinued operations

1 304

1 304

Net profit/(loss) for the period

(827)

6 698

5 870

Net FX impact

Other comprehensive income

16 767

16 767

Total comprehensive income or (loss) for the period

(827)

6 698

5 870

Net profit/(loss) attributable to shareholders

(827)

6 698

5 870

Holding Structure

Emerging Markets Portfolio

Spice Private Equity Group

Other liabilities 1)

(6 176)

(119)

(6 295)

Net cash

40 714

14 240

54 954

16 396

16 396

Receivables

147 632

147 632

Net cash and receivables

188 346

14 240

202 586

1 January – 31 December 2014 (restated) in TUSD

Net unrealized gain on investments

2 433

2 433

Total income

2 433

2 433

Management and administration fees 31 007

219 353

0.0 %

0.0 %

0.0 %

Excludes financial liability (put option on own equity-instruments of USD 15.7 million).

1)

9 564 11 966

Other comprehensive income or (loss) for the period

Spice Private Equity Group

239

Borrowings

– 927

Leverage ratio

2 377

239

188 346

951

2 377

61 010

Investments, net cash and receivables

25

Currency translation differences

14 359

Outstanding commitments

927

Net other comprehensive income to be reclassified to profit or (loss) in subsequent periods

46 651

Other assets

Spice Private Equity Group

Items to be reclassified to profit/ (loss) in subsequent periods:

Excludes financial liability (put option on own equity-instruments of USD 15.8 million).

1)

31 December 2014 (restated) in TUSD

Emerging Markets Portfolio

(2 340)

Other operating expenses

Tax expenses Investments, net cash and receivables

Holding Structure

(109)

(3 728)

(3 838)

Other operating expenses

(2 835)

(242)

(3 076)

Total expenses

(2 944)

(3 970)

(6 914)

Profit/(loss) before FX, taxes and discontinued operations impact

(2 944)

(1 537)

(4 481)


23

MANAGEMENT REPORT  ANNUAL REPORT 2015

1 January – 31 December 2014 (restated) in TUSD

Net FX impact Tax expenses/(refund)

Holding Structure

401 

Emerging Markets Portfolio

 2 459 

Spice Private Equity Group

 2 860 

Discontinued Operations

 (4 386)

 (4 386)

Net profit/(loss) for the period

 (6 929)

  922 

 (6 007)

Other comprehensive income Items to be reclassified to profit/ (loss) in subsequent periods: Currency translation differences

473 

Foreign exchange effect Increase/(decrease) in cash and cash equivalents

Holding Structure

Emerging Markets Portfolio

Spice Private Equity Group

 87 

 342 

 429 

 (8 933)

 (2 432)

 (11 365)

Cash and cash equivalents as of 1 January

 46 651 

 14 359 

 61 010 

Cash and cash equivalents as of 31 December

 37 718 

 11 927 

 49 645 

1 January – 31 December 2014 (restated) in TUSD

Holding Structure

Emerging Markets Portfolio

Spice Private Equity Group

(14 128)

(14 128)

473 

Net other comprehensive income to be reclassified to profit or (loss) in subsequent periods

473 

473 

Other comprehensive income or (loss) for the period

473 

473 

Cash flows from operating activities Purchases and capital calls

Total comprehensive income or (loss) for the period

 (6 456)

922 

 (5 534)

Net profit/(loss) attributable to shareholders

 (6 456)

  922 

 (5 534)

Statement of Cash Flows by Holding Structure, Portfolio and for the Group The following table provides information on cash flows incurred at holding structure, portfolio level and for the Group. Holding Structure

Emerging Markets Portfolio

Spice Private Equity Group

Purchases and capital calls

(48 991)

(48 991)

Proceeds from non-current assets

1 January – 31 December 2015 in TUSD

1 January – 31 December 2015 in TUSD

Proceeds from non-current assets Dividends received/(paid)

17 520

17 520

Operating costs

(3 621)

(3 839)

(7 460)

Total net cash generated from/ (used) in operating activities

13 899

(17 967)

(4 068)

Cash flows from investing activities Investment in unconsolidated subsidiary

(13 501)

13 501

Proceeds from sale of subsidiary, net of cash transferred

37 372

37 372

Total net cash generated from/ (used) in investing activities

23 871

13 501

37 372

Cash flows from operating activities

Interest and dividend received/(paid)

 11 839 

 11 839 

Cash flows from financing activities Repayment of borrowings Treasury share purchases

  25 

  25 

Operating costs

 (6 227)

 (5 647)

 (11 874)

Total net cash generated from/ (used) in operating activities

 (6 227)

 (42 774)

 (49 001)

Treasury share sales

55

55

(447)

(447)

249

249

Total net cash generated from/ (used) in financing activities

(142)

(142)

Foreign exchange effect

(668)

(971)

(1 639)

Cash flows from investing activities Investment in unconsolidated subsidiary Proceeds from sale of subsidiary, net of cash transferred Total net cash generated from/ (used) in investing activities

 (40 000) 37 372 

 40 000   –   

(2 628)

40 000 

(841)

 –   

 –   

36 961

(5 437)

31 523

37 372 

Cash and cash equivalents as of January 1

9 691

19 796

29 487

37 372 

Cash and cash equivalents as of 31 December

46 651

14 359

61 010

Cash flows from financing activities Treasury share purchase

(841)

Treasury share sale

866 

 –   

Finance costs paid

(191)

 –   

(191)

 (166)

 –  

(166)

Total net cash generated from/ (used) in financing activities

Increase/(decrease) in cash and cash equivalents

866 


24

ANNUAL REPORT 2015  MANAGEMENT REPORT

SPICE PRIVATE EQUITY GROUP PORTFOLIO IN TUSD Name of the investment

Opening balance at cost 1.1.2015

Opening balance at fair value 1.1.2015

Cumulative gain/(loss) 1.1.2015

Paid in capital 1.1.2015–31.12.2015

Direct Co-Investments Africa Oil Corporation

5 043

Altico Capital

6 795

7 615

7 539

 (76)

9 045

7 615

7 539

 (76)

20 883

Giant Interactive Rede D’Or Subtotal Direct Co-Investments

 –   

As % of Total Spice Private Equity Group Investments

Fund Investments Global EM Funds Portfolio Global EM PF I

14 523

Subtotal Global EM Funds Portfolio

 14 523 

As % of Total Spice Private Equity Group Investments Asia-Pacific Funds Portfolio Baring Asia VI Navis Asia Fund VII Northstar Equity Partners IV

 19  –   

 –   

 (19)

 596

 –   

 –   

1 500  1 266 

Quvat Capital Partners II

5 075

7 902

2 827

 69

Subtotal Asia-Pacific Funds Portfolio

5 094

7 902

2 808

3 431

2 225

As % of Total Spice Private Equity Group Investments Latin American Funds Portfolio DLJ South America Partners

LatAm Portfolio I

5 196

Subtotal Latin American Funds Portfolio

7 421

1 800

1 325

 (475)

 519

 16

 –   

 (16)

 945

1 816

1 325

 (491)

1 463

6 911

9 228

2 317

26 838

14 526

16 767

2 241

47 721

As % of Total Spice Private Equity Group Investments Sub-Saharan Africa Funds Portfolio Carlyle Sub-Saharan African Fund Helios Investors III Subtotal Sub-Saharan Africa Funds Portfolio As % of Total Spice Private Equity Group Investments Subtotal Fund Investments As % of Total Spice Private Equity Group Investments

Total Total of all Investments As % of Total Spice Private Equity Group Investments Not disclosed on an individual basis for Direct Co-Investments

1)


MANAGEMENT REPORT  ANNUAL REPORT 2015

Returned capital 1.1.2015–31.12.2015

Cost 31.12.2015

Fair value 31.12.2015

Cumulative gain/(loss) 31.12.2015

Unrealized gain/(loss) 31.12.2015

Realized gain/(loss) 31.12.2015

Outstanding commitments

Investment currency

Vintage year

2015

 –   

 5 043 

1)

1)

1)

1)

 –   

USD

 –   

 6 795 

1)

1)

1)

1)

3 250

USD

2015

7 615

 –   

1)

1)

1)

USD

2014

 9 045 

1)

1)

1)

1)

1 984

USD

2015

20 001

 (882)

 (882)

2 233

5 234

USD

2015

7 615

20 883

30 %

 255 

 14 268 

24 850

10 581

10 581

 90 

 6 309 

 255 

14 268

24 850

10 581

10 581

 90 

 6 309

38 %

 –   

 616 

 515

 (100)

 (81)

 –   

2 405

USD

2014

 –   

 1 500 

1 267

 (233)

 (233)

 –   

3 538

USD

2014

 –   

 1 266 

 1 084 

 (182)

 (182)

 –   

3 791

USD

2015

 –   

 5 144 

8 760

3 616

 788

 –   

 16

USD

2014

 –   

8 525

11 626

3 101

 293

 –   

9 750

 604

USD

2015

USD

2015

18 %

 58

 2 167 

2 114

 (53)

 (53)

 55 

 –   

 5 196 

5 526

 331

 331

 –   

7 362

7 640

 277

 277

 58

 55

 –     604

12 %

 365 

 1 954 

1 048

 (906)

 (431)

 24 

3 181

USD

2014

 10 

 951 

 660

 (291)

 (275)

 –   

4 083

USD

2014

1 708

 (1 197)

 (706)

 24 

7 264

12 763

10 446

 169

23 927

11 881

9 564

2 402

29 160

 375

2 905

3 %  688

33 061

45 823 70 %

8 303

53 944

65 824 100 %

25


FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD


28

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

BALANCE SHEET AS OF 31 DECEMBER 2015, 31 DECEMBER 2014 (RESTATED) AND 1 JANUARY 2014 (RESTATED) IN TUSD Note

31.12.2015

31.12.2014 (restated)

1.1.2014 (restated)

9 691

Assets Current assets – Cash and cash equivalents

4.1

37 718

46 651

– Receivables and prepayments

4.2

37 593

37 323

172 

75 311

83 974

9 863 

74 086

110 548

7 783 

77 705

31 007

234 662 

151 791

141 555

242 445 

227 102

225 529

252 308 

Total current assets Non-current assets – Receivables non-current

5.1

– Loan to subsidiary – Unconsolidated subsidiaries at fair value through profit or loss

3

Total non-current assets Total assets Liabilities and Shareholders’ Equity Current liabilities – Payables and accrued charges

6.1

1 552

4 264

843 

– Put option liability

6.2

15 755

15 736

17 582 

– Provisions

6.3

283

1 912

Total current liabilities

17 589

21 913

18 425 

Total liabilities

17 589

21 913

18 425 

Shareholders’ Equity – Share capital

7

– Share premium – Treasury shares (at cost)

8

– Retained earnings /(accumulated deficit) – Net profit /(loss) for the period – Currency translation differences

2.4

Total Shareholders’ Equity Total liabilities and Shareholders’ Equity

53 980

53 980

60 311 

346 067

346 067

426 353 

(157)

(182)

 - 

(196 721)

(190 714)

(252 780)

5 870

(6 007)

473

473

209 512

203 617

233 883 

227 102

225 529

252 308 

5 357 322

5 355 800

5 363 717

39.11

38.02

43.60

Net Asset Value per share Number of shares outstanding at reporting date Net Asset Value per share attributable to shareholders

8

The accompanying notes on pages 32 to 52 form an integral part of these financial statements.


29

FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD 1 JANUARY TO 31 DECEMBER 2015 AND 1 JANUARY TO 31 DECEMBER 2014 (RESTATED) IN TUSD 1.1.2015 – 31.12.2015

1.1.2014 – 31.12.2014 (restated)

10.2

927

58

4 081

10.1

6 698

(2 758)

7 682

1 323

Note

Income Interest income Net gain on foreign exchange Net change in fair value of unconsolidated subsidiary Total income Expenses Administration fees

15

(103)

(109)

Other operating expenses

11

(2 340)

(2 835)

Finance costs

12

(674)

(3 116)

(2 943)

4 566

(1 621)

1 304

(4 386)

5 870

(6 007)

5 355 841

5 360 529

0.85

(0.30)

0.85

(0.30)

Total expenses Income tax expenses

13

Net operating profit/(loss) from continuing operation Discontinued Operations

9

Total net profit/(loss) for the period Earnings per share Weighted average number of shares outstanding during the period Net profit /(loss) per share (in USD) – basic

14

Net profit /(loss) per share (in USD) – diluted Other comprehensive income Items to be reclassified to profit/(loss) in subsequent periods:

473

Other comprehensive income to be reclassified to profit /(loss) in subsequent periods

Currency translation differences

2.4

473

Other comprehensive income/(loss) for the period

473

5 870

(5 534)

Total comprehensive income/(loss) for the period

The accompanying notes on pages 32 to 52 form an integral part of these financial statements.


30

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

STATEMENT OF CASH FLOWS FOR THE PERIOD 1 JANUARY TO 31 DECEMBER 2015 AND 1 JANUARY TO 31 DECEMBER 2014 (RESTATED) IN TUSD Note

31.12.2015

31.12.2014 (restated)

9

17 520

Cash flows from operating activities Dividends and interest received from unconsolidated subsidiaries Operating costs

(6 227)

(3 621)

(6 227)

13 899

3

(40 000)

(13 501)

4.2

37 372

37 372

(2 628)

23 871

55

Total net cash generated from /(used) in operating activities Cash flows from investing activities Investment in unconsolidated subsidiaries Deferred sale proceeds from sale of the subsidiaries Total net cash generated from /(used) in investing activities Cash flows from financing activities Repayment of borrowings Finance cost paid

(191)

Treasury share purchases

(841)

(447)

Treasury share sales

866

249

(166)

(142)

87

(668)

(8 933)

36 960

Cash and cash equivalents as of 1 January

46 651

9 691

Cash and cash equivalents as of 31 December

37 718

46 651

Total net cash generated from /(used) in financing activities Foreign exchange effect on cash and cash equivalents Increase /(decrease) in cash and cash equivalents

The accompanying notes on pages 32 to 52 form an integral part of these financial statements.


31

FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY AS OF 31 DECEMBER 2015 AND 31 DECEMBER 2014 (RESTATED) IN TUSD

Share capital

Share premium

Less treasury shares (at cost)

60 311

 426 353

Net profit/(loss)

Currency translation differences

473 

473 

473 

(6 007)

(5 534)

(35 533)

35 533 

(6 331)

(44 753)

26 533 

(24 550)

(182)

(182)

Total Equity as of 31 December 2014 (restated)

53 980 

346 067 

(182)

473 

(196 721)

203 617 

Balance as of 1 January 2015

53 980

346 067

(182)

473

(196 721)

203 617

Net profit/(loss)

5 870

5 870

Other comprehensive income

Total comprehensive income

– 

5 870

5 870

Shareholders’ Equity

Balance as of 1 January 2014 (restated)

Total comprehensive income Reclass reserves to retained earnings Retranslation of equity items into presentation currency Purchase and sale of treasury shares

Purchase and sale of treasury shares Total equity changes Total equity as of 31 December 2015

Currency translation differences

Retained earnings/ accumulated deficit

(252 780)

233 883 

 (6 007)

(6 007)

Total

25

25

25

5 870

5 895

53 980

346 067

(157)

473

(190 851)

209 512

The accompanying notes on pages 32 to 52 form an integral part of these financial statements.


32

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

NOTES TO THE FINANCIAL STATEMENTS

NOTE 1

CORPORATE INFORMATION

Spice Private Equity Ltd (formerly APEN Ltd, Zug) (“the Company”) is a Swiss stock corporation established under the relevant provisions of the Swiss Code of Obligations and domiciled in Zug. The Company’s shares are listed on the SIX Swiss Exchange. The address of the registered office of the Company is Industriestrasse 13c, 6302 Zug, Switzerland. Spice Private Equity (Bermuda) Ltd (“the Subsidiary”) is an unconsolidated subsidiary and carried at fair value through profit or loss in these financial statements. The Company’s structure as of 31 December 2015 is displayed below.

On 31 December 2014, Spice Private Equity Ltd sold its previous operating segment “Legacy Portfolio” in a single, coordinated transaction which included its investments in former unconsolidated subsidiaries APEN Holdings LLC and APEN Faith Media Holdings LLC as well as the respective subsidiaries of APEN Holdings LLC (APEN Bermuda Legacy Ltd (formerly APEN Bermuda Ltd), APEN Holdings (Bermuda) Ltd and APEN FMH LLC). After the disposal of the “Legacy Portfolio” the Company’s only remaining subsidiary is Spice Private Equity (Bermuda) Ltd (formerly APEN Bermuda EM Ltd).

Organizational Structure as of 31 December 2015

GP INVESTMENTS

NEWBURY PARTNERS

FORTRESS ENTITIES

OTHER

(SHAREHOLDER)

(SHAREHOLDER)

(SHAREHOLDER)

SHAREHOLDERS

100 % GP ADVISORS LTD, ZURICH

1

SPICE PRIVATE EQUITY LTD, ZUG*

BoD***

2

100 % GP ADVISORS (BERMUDA) LTD

100 % SPICE PRIVATE EQUITY

IC****

(BERMUDA) LTD**

3

1

Administration Agreement between GP Advisors Ltd, Zurich and Spice Private Equity Ltd

2

Advisory Agreement between GP Advisors Ltd, Zurich and GP Advisors (Bermuda) Ltd

3

Investment Management Agreement between GP Advisors (Bermuda) Ltd and Spice Private Equity (Bermuda) Ltd

* ** *** ****

Spice Private Equity Ltd, formerly APEN Ltd Spice Private Equity (Bermuda) Ltd, formerly APEN Bermuda EM Ltd Board of Directors Investment Committee


FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

Through this complex structured secondary transaction, the Company fully exited its historical non-core portfolio. It also achieved a simplified financial and legal structure resulting in a more transparent corporate structure. The transaction allowed the Company to concentrate much sooner than expected on the pursuit of its new emerging markets focused investment strategy. To emphasize the transformation of the Company and the implementation of its new emerging markets focused investment strategy the Board of Directors has decided to change the name of the Company to Spice Private Equity Ltd (new ticker symbol SPCE at SIX Swiss Exchange). The name change was approved by the Extraordinary General Meeting (EGM) held on 26 February 2015.

The investment objective of the Company is to realize long-term capital appreciation and investment income or both by creating a portfolio of Direct Investments and Fund Investments in the private equity sector. The investments will be diversified among fund managers, geographical regions, economic sectors and stages with a focus on emerging markets. To better reflect the performance of the underlying investments in the financial statements of the Company the Board of Directors has decided to switch the reporting currency from CHF to USD as of 1 January 2015. With the first publication of the Company financials in USD (Interim Report as of 31 March 2015) the quoting currency at the SIX Swiss Exchange was also switched from CHF to USD (20 May 2015).

Organizational Structure before Transaction occurring on 31 December 2014

GP INVESTMENTS

NEWBURY PARTNERS

OTHER

FORTRESS ENTITIES

(SHAREHOLDER)

(SHAREHOLDER)

SHAREHOLDERS

(SHAREHOLDER)

100 % GP ADVISORS LTD ZURICH *

5

APEN LTD, ZUG

1

99.75 % 100 % 2

100 %

APEN FAITH MEDIA HOLDINGS LLC

GP ADVISORS

APEN BERMUDA EM LTD

4

APEN HOLDINGS LLC DELAWARE 99 %

100 %

(BERMUDA) LTD

4

0.25 %

1%

APEN BERMUDA LEGACY LTD **

3

APEN FMH LLC

1

Administration Agreement between GP Advisors Ltd, Zurich and APEN Ltd, Zug

2

Advisory Agreement between GP Advisors Ltd, Zurich and GP Advisors (Bermuda) Ltd

3

Investment Management Agreement between GP Advisors (Bermuda) Ltd and APEN Bermuda EM Ltd and APEN Bermuda Legacy Ltd

4

Class C shares

5

Class A shares

*

GP Advisors Ltd, Zurich, formerly APEN Services GmbH

** APEN Bermuda Legacy Ltd, formerly APEN Bermuda Ltd

APEN HOLDINGS (BERMUDA) LTD

33


34

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

The portfolio currently held by the Subsidiary consists exclusively of investments in emerging markets. Inflows arising from the sale of the “Legacy Portfolio” are to be invested in emerging markets, covering various regions, in particular Asia-Pacific, Sub-Saharan Africa and Latin America. The allocation will be opportunistic, generally within asset allocation boundaries. Further diversification will be achieved with Direct Investments, in particular through diversification across industry and stage, as well as through geography. With primary and secondary fund investments the diversification will mainly be achieved through different managers in various countries. Although the Company may invest directly in funds or companies, it is anticipated that its future investments will also be made through the Subsidiary. The Company’s Board of Directors is responsible for the policies and management of the Company as well as for the valuations. As of 31 December 2015 the Company employed no employees (31 December 2014: nil).

Since 1 July 2013, responsibility for portfolio management of the Company was delegated to GP Advisors (Bermuda) Ltd (“the Manager”) through two separate Investment Management Agreements with APEN Bermuda Legacy Ltd (since divested) and Spice Private Equity (Bermuda) Ltd, while responsibility for administrative services was delegated to GP Advisors Ltd, Zurich (“Administrator”) through an Administration Agreement with Spice Private Equity Ltd. The Company’s financial statements were authorized by the Board of Directors for issue on 16 February 2016. The financial statements are subject to approval at the Annual General Meeting of shareholders on 19 May 2016. The financial statements are presented in US Dollars (USD) and all values are rounded to the nearest thousand, except per share data or when otherwise indicated.

Legal entity

Change

Effective date

APEN Holdings LLC

Sold to Strategic Partners

31 December 2014

APEN Faith Media Holdings LLC

Sold to Strategic Partners

31 December 2014

APEN Ltd Zug

Renamed to Spice Private Equity Ltd

26 February 2015

APEN Bermuda EM Ltd

Renamed to Spice Private Equity (Bermuda) Ltd

3 March 2015

NOTE 2 ACCOUNTING POLICIES 2.1 Basis of Preparation The accompanying financial statements of the Company for the year ended 31 December 2015 have been prepared in accordance with International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB), and comply with Swiss law and the accounting provisions for investment companies of the SIX Swiss Exchange. The Company’s financial statements are prepared under the Historical Cost Convention, with the exception of its unconsolidated subsidiary carried at fair value through profit or loss and derivative financial instruments which are stated at their fair values as disclosed in the accounting policies hereafter. The IASB issued an amendment to IFRS 10 to provide an exception to the consolidation requirement for entities that meet the definition of an investment entity. The exception to consolidation requires investment entities to account for subsidiaries at fair value through profit or loss.

These separate financial statements are those of Spice Private Equity Ltd. The unconsolidated subsidiary of Spice Private Equity Ltd is carried as a financial investment at fair value through profit or loss and has a 31 December year-end. The following subsidiary is carried at fair value through profit or loss: Name of subsidiary

Country of incorporation

Proportion of ownership interest

Proportion of voting rights held

Spice Private Equity (Bermuda) Ltd

Hamilton, Bermuda

100 %

100 %

The Subsidiary is incorporated in Hamilton Bermuda. Its main business purpose is to make private equity investments solely for capital appreciation, investment income or both. The Subsidiary has no employees, therefore in order to perform its investment activity it has delegated the relevant tasks to GP Advisors (Bermuda) Ltd through an Investment Management Agreement. According to the agreement all in-


FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

vestments and divestiments made at the Subsidiary level are proposed by the Investment Committee of GP Advisors (Bermuda) Ltd and approved by the Subsidiary’s Board of Directors. The Subsidiary’s Board of Directors is composed of three members of which two members are also board members of Spice Private Equity Ltd. 2.2 Significant Accounting Judgments and Estimates The preparation of financial statements requires the Board of Directors to make estimates and assumptions and exercise judgment that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. Judgments The Board of Directors has assessed the definition of an investment entity and concluded that Spice Private Equity Ltd as well as Spice Private Equity (Bermuda) Ltd meet the three key characteristics of an investment entity, as the entities: • Obtain funds from one or more investors for the purpose of providing its investors with professional investment management services; • Commit to its investors that its business purpose is to invest funds solely for returns from capital appreciation, investment income or both; and • Measure and evaluate the performance of substantially all of its investments on a fair value basis. Neither Spice Private Equity Ltd nor Spice Private Equity (Bermuda) Ltd have any other business activity or separate substantial source of income apart from its business purpose which is to invest solely for capital appreciation, investment income or both. Underlying investments are commonly held by Spice Private Equity (Bermuda) Ltd, however could also be held by Spice Private Equity Ltd itself. The Company’s exit strategy for all of its underlying investments follows the defined exit strategy of the lead investor/sponsor for Direct Investments and the General Partners for Fund Investments. The Company’s underlying investments are usually divested within a period of five to seven years. No underlying investments are planned to be held indefinitely. The Company indirectly holds a number of different underlying investments to diversify the risk within the portfolio and to maximize its returns for its multiple investors.

Estimates The areas involving assumptions and estimates that are significant to the financial statements are the following: • Fair value of unconsolidated subsidiaries. In accordance with the requirements for investment entities, the Company recognizes its subsidiaries at fair value through profit or loss. Major inputs for determining the fair value of the subsidiaries is the measurement of their underlying investments and operating expenses. The fair value of its unconsolidated subsidiaries is determined as the net equity of those subsidiaries, as the underlying assets and liabilities carried in those subsidiaries equal or approximate fair value, i. e., net equity is most reflective of fair value (see also Note 2.5.6 “Financial Instruments – Determination of Fair Value”). The Company uses its judgment to select an appropriate valuation technique and make assumptions that are not always supported by observable market prices or rates. Changes in assumptions could affect the reported fair value of these investments. The carrying amounts of the Company’s unconsolidated subsidiaries (which are affected by the fair values of its ultimate investments) amounted to USD 77.7 million. Refer to Note 16.5 for further details. 2.3 Change in functional and presentation currency 2.3.1 Change in functional currency The Board of Directors of the Company assessed the underlying characteristics of the Company’s currency exposure subsequent to the sale of the “Legacy Portfolio”. Following the 2014 transaction the Company’s Management considers that US Dollar is the currency that best reflects its underlying transactions, events and conditions for the preparation of the financial statements. As a consequence, the Board determined to change the functional currency from Swiss francs (CHF) to USD. The following main factors were considered by the Management when assessing the change in functional currency: • The currency that mainly influences transactions and the currency of the country whose competitive forces and regulations mainly determine the prices of its transactions is USD. • The currency in which funds from financing activities are generated and in which receipts from operating activities are usually retained is USD. The Company obtains dividends and distributions primarily in USD. As the change in functional currency of the Company’s statutory financial statements also changed to USD simultaneously, retained earnings and reserves are also retained in USD going forward.

35


36

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

• Most of the transactions of the Company have been and are expected to continue to be transacted in USD, whilst only certain of the Company’s administrative expenses are expected to continue to be denominated in CHF. • All future cash flows resulting from the sale of the “Legacy Portfolio” in the next two years (outstanding receivables) are denominated in USD. • USD is the currency that influences the amount of performance fee.

2.3.3 Adoption of other Standards and Interpretations The following new standards and amendments to standards are mandatory for the first time for the financial year beginning 1 January 2015 and have been adopted by the Company:

The effect of the change in functional currency has been accounted for prospectively. Starting 1 January 2015 the Company has translated all items into the new functional currency using the exchange rate at the date of the change. Exchange differences arising from the translation of a foreign operation previously recognized in other comprehensive income are not reclassified from equity to profit or loss until the disposal of the operation.

The above amendments had no impact on the financial position or performance of the Company.

2.3.2 Change in presentation currency Following the change in functional currency the Company’s Board of Directors decided to change the presentation currency from CHF to USD. The change in presentation currency was made in order to avoid unnecessary volatility in the reported Net Asset Value (“NAV”), to better reflect the Company’s business activities and to improve investors’ ability to compare the Company’s financial results with other publicly traded investment entities in the private equity sector. The 2014 figures were translated into USD using the 2014 average exchange rate for the income statement and the year-end rate for the balance sheet accounts respectively. The translation led to a one-time FX difference due to different FX rates for the profit and loss and the balance sheet accounts conversion which was offset against retained earnings. All 1 January 2014 numbers were restated using the spot exchange rate as of 31 December 2013. The change in presentation currency was treated as a change in accounting policy which requires retrospective application of the change in presentation currency by restating the 2014 comparative amounts into the new presentation currency. For more details please see paragraph 2.4 Restatement.

• Defined Benefit Plans: Employee Contributions (Amendments to IAS 19) • Various Improvements to IFRSs – 2010–2012 cycle • Various Improvements to IFRSs – 2011–2013 cycle

2.4 Restatement The change in presentation currency has resulted in the following changes to the financial statements. Opening Balance Sheet as of 1 January 2014 Presented TCHF

Restated TUSD

8 619

9 691

Assets Current assets Cash and cash equivalents Receivables and prepayments Total current assets

153

172

8 772

9 863

6 921

7 783

Non-current assets Loan to subsidiary Unconsolidated subsidiaries at fair value through profit or (loss) Total non-current assets Total assets

208 697

234 662

215 618

242 445

224 390

252 308

Liabilities Current liabilities 749

843

Put option liability

Payables and accrued charges

15 636

17 582

Total current liabilities

16 386

18 425

16 386

18 425

53 637

60 311

379 177

426 353

Total liabilities Shareholders’ Equity Share capital Share capital premium Retained earnings/(accumulated deficit)

(224 810)

(252 780)

Total Shareholders’ Equity

208 004

233 883

Total liabilities and Shareholders’ Equity

224 390

252 308


37

FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

Income Statement 1 January to 31 December 2014 Presented TCHF

Cash Flow Statement 1 January to 31 December 2014 Restated TUSD

Income Net gain on foreign currency exchange Net change in fair value of unconsolidated subsididary Total income

Other operating expenses Total expenses Tax expenses/(refund) Net operating profit/(loss) from continuing operations Discontinued operations Total net profit/(loss) for the period

 3 736   (2 525)

 4 081   (2 758)

 1 211 

 1 323 

 (100)

 (109)

 (2 595)

 (2 835)

Dividends received from unconsolidated subsidiaries

16 038

17 520

Operating costs

 (3 314)

 (3 621)

Total net cash generated from/(used) in operating activities

 12 723 

 13 899 

 (12 359)

 (13 501)

37 135

37 372

 24 776 

 23 871 

Cash Flows from Investing activities

 (2 695)

 (2 944)

 (1 484)

 (1 621)

 (4 015)  (5 499)

 (4 386)  (6 007)

Other comprehensive income or (loss) for the period

Investment in unconsolidated subsidiary Proceeds from sale of subsidiary, net of cash transferred Total net cash generated from/(used) in investing activities Cash flows from financing activities Repayment of borrowings Treasury share purchases Treasury share sales Total net cash generated from/(used) in financing activities Foreign exchange effect

Items to be reclassified to profit/(loss) in subsequent periods: Currency translation differences

Restated TUSD

Cash flows from operating activities

Expenses Administration fees

Presented TCHF

  473 

Net other comprehensive income to be reclassified to profit or (loss) in subsequent periods

  473 

Other comprehensive income or (loss) for the period

  473 

Total comprehensive income/(loss) for the period

 (5 499)

 (5 534)

Net profit/(loss) attributable to shareholders

 (5 499)

 (5 534)

Increase/(decrease) in cash and cash equivalents

51

55

 (409)

 (447)

228

249

 (130)

 (142)

367

 (668)

 37 736 

 36 960 

Cash and Cash Equivalents as of 1 January

 8 619 

 9 691 

Cash and Cash Equivalents as of 31 December

46 355

46 651


38

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

Balance Sheet as of 31 December 2014 Presented TCHF

Restated TUSD

Assets Current assets Cash and cash equivalents

46 355

46 651

Receivables and prepayments

37 086

37 323

Total current assets

83 441

83 974

Non-current assets Receivables Unconsolidated subsidiaries at fair value through profit or (loss)

109 846

110 548

30 810

31 007

Total non-current assets

140 656

141 555

Total assets

224 097

225 529

Liabilities and Shareholders’ Equity Current liabilities Payables and accrued charges Put option liability Provision Total current liabilities Total liabilities

4 237

4 264

15 636

15 736

1 900

1 912

21 773

21 913

21 773

21 913

ing from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in the Statement of Comprehensive Income (“net gain or loss on foreign exchange”). Translation differences on monetary items, such as the put option liability, are reported as part of the gain or loss on foreign exchange. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated into the functional currency at the exchange rate when the fair value was determined. Non-monetary items that are measured based on historical cost in a foreign currency are translated at the exchange rate at the date of the transaction. When a gain or loss on a non-monetary item is recognized in other comprehensive income, any foreign exchange component of that gain or loss is recognized in other comprehensive income. Conversely, when a gain or loss on a non-monetary item is recognized in comprehensive income for any foreign exchange component of that gain or loss is recognized in comprehensive income for the period. 2.5.2 Foreign Exchange Rates The following exchange rates have been applied to translate the foreign currencies of significance for the Company: Unit

2015 USD

2014 USD

Swiss Franc

1 CHF

1.00756

1.00639

Euro

1 EUR

1.09060

1.21005

Swiss Franc

1 CHF

1.03907

1.09239

Euro

1 EUR

1.11040

1.32847

Shareholders’ Equity Share capital Share premium Treasury share (at cost) Retained earnings Net profit (loss) for the period Currency translation differences Total Shareholders’ Equity Total liabilities and Shareholders’ Equity

53 637

53 980

347 400

346 067

(181)

(182)

(193 033)

(190 714)

(5 499)

(6 007)

473

202 324

203 617

224 097

225 529

2.5 Summary of Significant Accounting Policies 2.5.1 Foreign Currency Transactions Functional and presentation currency As of 1 January 2015 the functional currency of Spice Private Equity Ltd is the USD as this entity is primarily exposed to the USD. The presentation currency of the financial statements of the Company is USD and its shares are traded on the SIX Swiss Exchange in USD since 20 May 2015. Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing on the dates of the transactions. Foreign exchange gains and losses result-

Year-end exchange rates

Average annual exchange rates

2.5.3 Cash and Cash Equivalents Cash includes cash on hand and cash with banks. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash, with original maturities of three months or less, and that are subject to an insignificant risk of change of value. Cash and cash equivalents are recorded at nominal value. In order to mitigate concentration risk, cash is held at various banks. 2.5.4 Financial Instruments – Initial Recognition and Subsequent Measurement a) Financial assets – initial recognition Financial assets are classified as financial assets at fair value through profit or loss or as loans and receivables. The Company determines the classification of its financial assets at initial recognition.


FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

Financial assets are recognized initially at fair value plus, in the case of investments not at fair value through profit or loss, directly attributable transaction costs.

Changes in the fair value of financial instruments at fair value through profit or loss are recorded in the Statement of Comprehensive Income.

Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace (regular way purchases) are recognized on the settlement date, i. e., the date a financial asset is delivered to or by the Company. The Company’s financial assets include cash and cash equivalents and short-term deposits, trade and other receivables, loan and other receivables, quoted and unquoted financial instruments, and derivative financial instruments.

c) Financial liabilities – Initial recognition Financial liabilities within the scope of IAS 39 are classified as financial liabilities at fair value through profit or loss or as other financial liabilities, as appropriate. The Company determines the classification of its financial liabilities at initial recognition. Financial liabilities are recognized initially at fair value and in the case of loans and borrowings, less directly attributable transaction costs.

Investments in unconsolidated subsidiaries are carried at fair value.

The Company’s financial liabilities include payables and accrued charges, loans and borrowings, other financial liabilities and derivative liabilities.

b) Financial assets – subsequent measurement The subsequent measurement of financial assets depends on their classification as follows:

d) Financial liabilities – subsequent measurement The measurement of financial liabilities depends on their classification as follows:

b1) Loans and receivables All loans and receivables are subsequently measured at amortized cost using the effective interest method. Gains and losses are recognized in the Statement of Comprehensive Income when the loans and receivables are derecognized or impaired, as well as through the amortization process.

• Financial liabilities at fair value through profit or loss Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition at fair value through profit or loss. This category includes derivative financial instruments entered into by the Company. Gains or losses on liabilities held for trading are recognized in the Statement of Comprehensive Income.

b2) Investments in unconsolidated subsidiaries In accordance with the requirements for investment entities, Spice Private Equity Ltd recognizes its subsidiaries at fair value through profit or loss. Major input for determining the fair value of the subsidiaries is the underlying measurement of the investments. Spice Private Equity Ltd has entered into to benefit from capital appreciation, investment income or both. Changes in fair value are recorded in the Statement of Comprehensive Income in changes in fair values of unconsolidated subsidiaries. b3) Other financial assets at fair value through profit or loss Financial assets at fair value through profit or loss include financial assets held for trading and financial assets designated upon initial recognition at fair value through profit or loss. Financial assets are classified as held for trading if they are acquired for the purpose of selling in the near term. This category includes derivative financial instruments entered into by the Company. Financial assets at fair value through profit or loss are carried in the balance sheet at fair value.

• Loans and borrowings After initial recognition, interest bearing loans and borrowings are subsequently measured at amortized cost using the effective interest method. Gains and losses are recognized in the Statement of Comprehensive Income when the liabilities are derecognized as well as through the amortization process. • Put option liabilities Shareholders’ rights to request repurchase of Spice Private Equity Ltd own equity instruments (put options) are subsequently remeasured to match the present value of the redemption amount expected to be payable in case the investor exercises its rights and the change in value resulting from foreign exchange movement is recorded in: “Net gain/(loss) on foreign exchange”. 2.5.5 Financial Instruments – Derecognition A financial asset is derecognized if, and only if, the Company either transfers the contractual rights to receive the cash flows of the financial asset, or it retains the contractual rights to receive the cash flows of the financial asset, but assumes

39


40

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

a contractual obligation to pay the cash flows to one or more recipients, and in doing so transfers substantially all of the risks and rewards of the asset. A financial liability is derecognized when the obligation under the liability is discharged, is cancelled or has expired. When an existing financial liability is replaced by another liability from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognized in the Statement of Comprehensive Income. 2.5.6 Financial Instruments – Determination of Fair Value 2.5.6.1 Investment in unconsolidated subsidiaries The Company’s investments in unconsolidated subsidiaries do not have a quoted market price, nor can the fair value be determined with respect to observable input variables. The fair value of investments in unconsolidated subsidiaries is determined as the net assets of those subsidiaries as the underlying assets and liabilities carried in those subsidiaries equal or approximate fair value. Therefore, net assets are most reflective of fair value.

General Partners and company management. The Manager use valuations and valuation input provided by the Lead Fund Manager of the respective direct investment. Financial and market performance is compared with budget information, data obtained from competitors and subsequent rounds of financing. The Board of Directors reviews and discusses the valuations with the Manager and may independently apply adjustments to determine the investments’ fair value. In determining the fair value of a direct investment, all appropriate and applicable factors relevant to their value, including, but not limited to, the following are considered in general: • Available market prices for quoted securities in active markets; • Reference to the valuation of the lead investor or other investors; • Transaction price paid for an identical or a similar instrument in an investment, including subsequent financing rounds; • Comparable company valuation multiples; • Discounted cash flow method. For venture capital investments, the following is also considered:

The main driver of fair value of Spice Private Equity Ltd unconsolidated subsidiaries is the valuation of its investment portfolio assets, valuation of financial liabilities as well as to a much lesser extent the valuation of remaining asset and liability line items. The valuation assumptions and techniques are therefore disclosed hereafter.

A new financing round that is material in size for the Company and having new, sophisticated institutional investors making up a significant piece of the financing round. An inside round of financing does not qualify. For buyout/later stage investments for which subsequent rounds of finance are not anticipated the following is also considered:

Direct and Fund Investments The unconsolidated subsidiaries’ investments are primarily non-current financial assets for which market quotations are not readily available, therefore these investments are measured at their fair value using the most appropriate valuation techniques as described in detail below. General Partners of funds in which the subsidiaries invests, the Manager and the Service Manager of the subsidiaries’ Direct Investments provide valuations of these investments. Due to inherent uncertainties, the fair values used may differ significantly from values that could have been obstained in actual market transactions.

An analysis of the fair market value of such investment will be performed on an ongoing bases. This analysis will typically be based on one of the following methods (depending on what is appropriate for that particular company/industry):

a) Direct Investments Valuations for Direct Investments as of 31 December 2015 are provided by third party sources, such as General Partners of funds that are holding the same investment and that the Company is invested in or the lead investor of the relevant direct investment. The Manager monitors investments by analyzing regular reports and through direct contact with

• Result of multiple analysis; • Result of discounted cash flow analysis; • Reference to transaction prices (including subsequent financing rounds); • Reference to the valuation of other investors; • Reference to comparable companies. Based on a composite assessment of all appropriate and applicable indicators of fair value, the Board of Directors determines the fair values as of the valuation date. b) Fund Investments The valuation of Fund Investments is generally based on the latest available Net Asset Value (“NAV”) of the fund reported by the corresponding fund manager provided that the NAV


FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

has been appropriately determined by using proper fair value principles as per generally accepted accounting standards. The Board of Directors reviews and approves the NAV provided by the fund’s General Partners unless the Board of Directors is aware of reasons that such a valuation may not be the best approximation of fair value. In general, NAV is adjusted by capital calls and distributions falling between the date of the latest NAV of the fund and the reporting date of the Company. Additionally, a mark to market adjustment is applied if funds are invested in listed quoted securities which are traded in active markets.

d) Other financial assets Investments in securities and in other financial instruments traded in the over the counter market and listed securities for which no trade is reported on the valuation date are valued at the price within the bid-ask spread that is most representative of fair value in the circumstances.

Investment valuations are further generally based on previous quarter ended (compared to the reporting date) capital accounts. Adjustments to the valuation are considered when either of the following applies:

2.5.6.2 Investment Related Liabilities Fair values of investment related liabilities carried in the books of unconsolidated subsidiaries are determined individually by determining the net present value of future cash flows based on expected highly probable or contractual cash flows and a market interest rate adjusted to the risk profile of the Company.

• The Company becoming aware of subsequent changes in the fair values of underlying companies; • New/amended features of the fund agreement that might affect distributions; • Changes to market or other economic conditions impacting the value of the fund; • NAV reported by the fund has not been appropriately determined by applying the valuation principles as per generally accepted accounting standards. Further, when information is used based on data different from the reporting date, capital drawdowns and capital distribution activity of the remaining period until year-end is being added to and subtracted from the valuation as appropriate. Where more recent reporting is not available, valuations are based on the latest capital accounts provided by portfolio funds, with capital drawdowns and capital distribution activity being added to and subtracted from the valuation. The Company monitors current market activity related to these funds and the overall market developments to determine implications on the valuations and apply appropriate adjustments if necessary. The Company reviews the valuations of these funds and discusses portfolio company performance with the relevant portfolio fund managers. The portfolio fund managers determine fair values of the underlying investments by using the same valuation techniques as noted above for Direct Investments. c) Investments in securities and other financial instruments Investments in securities and in other financial instruments traded on recognized exchanges (including bonds, equities, futures contracts, options, and funds), are valued at the last price which is most representative of fair value on the reporting date.

e) Derivative financial instruments Fair values for derivative financial instruments are obtained from quoted market prices, discounted cash flow models, or option pricing models as appropriate.

2.5.7 Provisions Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. When the Company expects some or all of a provision to be reimbursed, the reimbursement is recognized as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the Statement of Comprehensive Income. 2.5.8 Shareholders’ Equity Ordinary shares are classified as equity. The transaction costs of an equity transaction are accounted for as a deduction from equity. Transaction costs for equity are comprised of only those incremental external costs directly attributable to the equity transaction, which would otherwise have been avoided. Equity is comprised of the following: • Share capital and share premium Please refer to Note 7 for a description and further details on the share capital and share premium. • Treasury shares Treasury shares are presented in the balance sheet as a deduction from equity and are measured at cost. The acquisition of treasury shares is presented as a change in equity. No gain or loss is recognized in the Statement of Comprehensive Income on the sale, issuance, or cancellation of treasury shares. The consideration received is presented in the financial statements as a change in equity.

41


42

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

2.5.9 Earnings per Share and Net Asset Value per Share Basic earnings per share are calculated by dividing the net profit for the period of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share are calculated by adjusting the weighted average number of ordinary shares outstanding assuming conversion of all dilutive potential ordinary shares. The Net Asset Value per share is calculated by dividing the net assets (total equity) included in the balance sheet by the number of ordinary shares outstanding at the reporting date. 2.5.10 Taxes Tax expense and taxes payable are based on reported income. Taxes are calculated in accordance with enacted tax regulations. Capital taxes charged to the Company are included in operating expenses in the Statement of Comprehensive Income. Switzerland The Company is taxed as a holding company in the canton of Zug. Income, including dividend income and capital gains deriving from its participations are exempt from taxation at the Zug cantonal/communal level. However, capital taxes are levied on Zug cantonal/communal level. For Swiss federal tax purposes, income tax at an effective tax rate of 7.8 % is levied. Provisions for taxes payable on profits earned by the Company are calculated and recorded based on the applicable tax rate in Switzerland. Spice Private Equity (Bermuda) Ltd’s activities are not subject to any income, withholding or capital gains taxes in Bermuda. 2.5.11 Capital Management The investment objective of the Company is to realize longterm capital appreciation by creating a portfolio of Direct Investments and Fund Investments in the private equity sector. The investments will be diversified among fund managers, geographical regions, economic sectors and stages. Please refer to Note 1 for further details. 2.5.12 Segment Reporting IFRS 8 requires companies to define operating segments and segment performance in the financial statements.

The sole operating segment of the Group is investing in private equity. Therefore, the results published in this report reflect the required operating segment information provided to the Chief Operating Decision Maker which are equivalent with the members of the Board of Directors. Additional disclosures required by IFRS 8 are presented in Note 19. 2.5.13 Contingencies Contingent liabilities are not recognized in the balance sheet. They are disclosed unless the possibility of an outflow of resources embodying economic benefits is remote. A contingent asset is not recognized except for limited instances where economic benefits are virtually certain. If these are only deemed probable, they are disclosed in the financial statements. Please refer to Note 18 for further details. 2.5.14 Share-based Compensation Plans Stock Appreciation Rights (SARs) The Company operates a cash settled, share-based compensation plan. The corresponding liability is re-measured at each balance sheet date to fair value, with changes recognized immediately in the Statement of Comprehensive Income. 2.6 Standards Issued but not yet Effective The IASB has issued new standards, amendments and interpretations to existing standards that are not yet effective. Of these the following may potentially be relevant to the Company. The Company has yet to adopt those standards and plans to do so for the reporting period beginning on or after the effective date stated in the respective standard: Expected to be applied first in financial year

New IFRS pronouncement

Title

IFRS 10/IAS 28

Investment entities: applying the consolidation exception*

2016

Various

Improvements to IFRSs – 2012–2014 cycle**

2016

IFRS 15

Revenue from contracts with customers**

2018

IFRS 9

Financial instruments**

2018

IFRS 16

Leases**

2019

* Please see Note 2.2. ** The Company is currently evaluating the implication of the above new or amended standards. Based on Board of Directors’s preliminary assesement to date, the Company does not anticipate that these will have a material impact on the Company’s overall results and financial position.


FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

NOTE 3 INVESTMENT TABLE (UNCONSOLIDATED SUBSIDIARIES) Opening balance at cost 1.1.2015

Investment table in subsidiaries 2015

Opening balance at fair value 1.1.2015

Cumulative gain/(loss) 1.1.2015

Paid in capital 1.1.2015– 31.12.2015

Returned capital 1.1.2015– 31.12.2015

Cost 31.12.2015

Fair value 31.12.2015

Unrealized gain/(loss) 31.12.2015

Cumulative gain/(loss) 31.12.2015

Spice Private Equity (Bermuda) Ltd

35 989

31 007

(4 982)

40 000

75 989

77 705

6 698

1 716

Total

35 989

31 007

(4 982)

40 000

75 989

77 705

6 698

1 716

Investment table in subsidiaries 2014 (restated)

APEN Holdings LLC 1) APEN Faith Media Holdings LLC 1) Spice Private Equity (Bermuda) Ltd Total 1)

Opening balance at cost 1.1.2014

Currency tranlsation differences 31.12.2014

Realized gain/(loss) 31.12.2014

Cost 31.12.2014

Fair Value 31.12.2014

– (175 898) (22 398)

(15 091)

– (66 390)

2 900

(2 690) 13 501

(4 982)

263 199 234 662 (28 537) 13 501

242 288

Opening balance at fair value 1.1.2014

Cumulative gain/(loss) 1.1.2014

Paid in capital 1.1.2014– 31.12.14

213 388 (28 901)

(1 578)

1 476

22 488

19 798

3 054

Returned capital 1.1.2014– 31.12.2014

Selling price

Unrealized gain/(loss) 31.12.2014

Cumulative gain/(loss) 31.12.2014

(1 322)

(153)

(1)

(3 214)

35 989

31 007

922

(177 221) (25 765) (15 092)

35 989

31 007

922 (68 472)

Investments in unconsolidated subsidiaries sold as of 31 December 2014.

NOTE 4 CURRENT ASSETS 4.1

Cash and Cash Equivalents 2015

2014 (restated)

Cash at banks

37 718

46 651

Total

37 718

46 651

Cash and cash equivalents comprise all cash, short-term deposits and other money market instruments, net of short-term overdrafts, with an original maturity of three months or less. Cash and cash equivalents are at the full disposal of the Company. The carrying amounts of cash and cash equivalents approximate fair value.

Receivable of TUSD 37 100 (2014 (restated): 37 084) relates to deferred payments resulting from the sale of the “Legacy Portfolio” as of 31 December 2014. The carrying amount includes effective interest rate and represents present value of the future cash flow to be received as of 30 June 2016. Please see below the remaining deferred payments schedule:

Type of payment

Due date

2nd deferred payment

30 June 2016

Amount in TUSD

37 372

3 deferred payment*

31 March 2017

37 372

4th deferred payment*

29 December 2017

37 372

rd

Sum of all payments

112 117

* Reported as receivables (non-current).

4.2

Receivables and Prepayments

Receivables Other receivables and prepayments Total

2015

2014 (restated)

37 100

37 084

493

239

37 593

37 323

During the reporting period the Company received in September 2015 the second cash installment (1st deferred payment) of USD 37.4 million from its counterparty in line with the deferred payments schedule. The carrying amount of other receivables and prepayments approximate fair value due to their short-term maturities and that the effect of not discounting them is immaterial.

43


44

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

NOTE 5 NON-CURRENT ASSETS 5.1

Receivables 2015

2014 (restated)

Receivables non-current

74 086

110 548

Total

74 086

110 548

Receivables non-current of TUSD 74 086 (2014 (restated): 110 548) related to deferred payments resulting from the sale of the “Legacy Portfolio” as of 31 December 2014 are presented at carrying amount including effective interest rate which is the estimated future cash flows payments over the expected period when the outstanding balance will be received in two equal instalments as follows: 31 March 2017 and 29 December 2017 respectively.

During 2015, of the TUSD 1 912 provisions as of 31 December 2014, the Company used TUSD 495 and released to discontinued operations TUSD 1 134 (refer to Note 9). The remaining provision as of 31 December 2015 stood at TUSD 283. The carrying amounts of provisions approximate fair value.

NOTE 7 SHARE CAPITAL The share capital of the Company as of 31 December 2015 amounts to TUSD 53 980 (31 December 2014 (restated): TUSD 53 980) consisting of 5 363 717 registered shares (31 December 2014: 5 363 717) with a par value of CHF 10.00 (USD 10.06) each. All issued shares are fully paid-in.

NOTE 6 CURRENT LIABILITIES 6.1

The outstanding balances represent provisions in connection with the sale of the “Legacy Portfolio” transaction concluded as of 31 December 2014.

Payables and Accrued Charges 2015

2014 (restated)

Payables and accrued charges

1 552

4 264

Total

1 552

4 264

The carrying amounts of accounts payable and accrued charges approximate fair value. Put Option Liability (Put/Call on Shares of Spice Private Equity Ltd) Pursuant to the subscription agreement dated 17 May 2013 between Drawbridge Special Opportunities Fund LP, New York, NY, USA (“Fortress-Drawbridge”) and the Company, Fortress-Drawbridge has the right to sell to the Company 717 266 shares acquired in connection with the implementation of the new corporate structure in 2013. This right to sell may be exercised for the first time on 12 June 2014 and not later than 12 June 2018. The exercise price is CHF 21.80 per share. The subscription agreement also provides that the Company has the right to buy from Fortress-Drawbridge the 717 266 shares. This right to buy may be exercised for the first time on 12 June 2014 and not later than 12 June 2018. The exercise price shall be CHF 41.50 per share. As a result, the Company has recognized a financial liability in the amount of USD 15.8 million (2014 (restated): USD 15.7 million) , which equals the present value of the redemption amount.

As of 1 January 2015, the Company changed its functional currency from CHF to USD. All equity items were translated into USD using the prevailing USD/CHF rate as of 31 December 2014. Based thereon the share capital of the Company was USD 53 979 943 divided into 5 363 717 fully paid registered shares with a nominal amount of USD 10.06 each.

6.2

6.3

Provisions for other Liabilities 2015

2014 (restated)

Provisions

283

1 912

Total

283

1 912

As of 31 December 2015 the Company has CHF 26.8 million (2014: CHF 26.8 million) authorized share capital outstanding. This authorized share capital will expire per 26 May 2017. As of 31 December 2015 the Company has CHF 26.8 million (2014: CHF 26.8 million) conditional share capital outstanding.

NOTE 8 NUMBER OF SHARES OUTSTANDING AT YEAR-END Share capital is broken down as follows: Number of Shares

Outstanding 1 January 2014 – Treasury shares sold – Treasury shares purchased – New shares from capital increase

5 363 717 9 988 17 905 –

Outstanding 31 December 2014

5 355 800

Outstanding 1 January 2015

5 355 800

– Treasury shares sold

36 319

– Treasury shares purchased

34 797

– New shares from capital increase Outstanding 31 December 2015

– 5 357 322


45

FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

The Company can trade in treasury shares in accordance with the relevant guidelines (the Company’s Articles of Association, Swiss company law, listing rules of the SIX Swiss Exchange). Treasury shares are treated as a deduction from the Shareholders’ Equity TUSD 157 (2014 (restated): 182). Currently, the Company does not intend to pay any dividends to shareholders. The following major shareholders held shares and voting rights of 3 % and more as of 31 December 2015 (number of shares according to the public disclosures of shareholdings at SIX; Swiss Exchange voting rights):

GP Investments/ Newbury Capital 1) Drawbridge Special Opportunities Fund LP (Fortress) OAM European Value Fund Wellington Management Company, LLP AXA Life

Number of shares 2015

Participation in % 2015

2 419 208

45.10 %

717 266

13.37 %

Number Participation of shares in % 2014 2014

2 419 208

717 266

45.10 %

13.37 %

270 149

5.04 %

270 149

5.04 %

211 128

3.94 %

210 936

3.93 %

167 000

3. 1 1  %

167 000

3. 1 1  %

The shares are held by two entities, namely GP Swiss Ltd. (Switzerland) (formerly GP Secondaries Investment Company (Switzerland) Ltd) and Newbury Holdings A Ltd. (Cayman Islands). These two entities are connected through a Shareholders’ Agreement.

1)

After purchase price adjustments of USD 12.9 million for distributions already received by the seller between the reference and closing dates the final consideration to be paid amounted to USD 186.8 million. The “Legacy Portfolio” was held through APEN Faith Media Holdings LLC and a participation in APEN Holdings LLC which were carried as unconsolidated subsidiaries at fair value through profit or loss. The portfolio was remeasured through profit and loss at the date of reclassification to discontinued operations. Balance sheet impact of discontinued operations: 2015

2014 (restated)

Fair value unconsolidated subsidiary as of 1 January

214 864

Unrealized gain/(loss) on subsidiaries

Selling price

(177 220)*

Net/(loss) on sale of subsidiary

(15 092)

Currency translation difference

(22 554)

Fair value unconsolidated subsidiary as of 31 December

* Consideration less discount on deferred payments.

Statement of Comprehensive Income impact of Discontinued Operations: 2015

Dividends revenues from unconsolidated subsidiaries

NOTE 9 DISCONTINUED OPERATIONS As of 31 December 2014 APEN Holdings LLC, APEN Faith Media Holdings LLC and their subsidiaries, together the “Legacy Portfolio”, were disposed of through outright sale. The sale was pursued by the Board of Directors in line with Spice Private Equity Ltd’s new focus on emerging markets. As the “Legacy Portfolio” qualified as an operating segment, this component of the Company represented a major line of business and was part of a single coordinated plan to be sold, hence it qualified as a discontinued operation.

17 520

1 304 1)

(5 961)

Net/(loss) on sale of subsidiary

(15 090)

Net gain on sale of loan

869

Currency translation difference

(1 725)

1 304

(4 386)

Transactions costs

Discontinued operations Reversal of 2014 transaction costs.

1)

For disclosure of related “Earnings per Share” please refer to Note 14. Cash flows associated with Discontinued Operations: 2015

The transaction price of USD 192.0 million represented a discount of 13.5 % to the value of the portfolio at the reference date (30 June 2014). Additionally, the purchaser acquired from the Company a USD 7.8 million loan obligation from APEN Faith Media Holdings LLC leading to a total transaction value of USD 199.7 million.

2014 (restated)

Cash flow from operating activity Cash flow from investing activity Cash flow from financing activity Net cash flows

2014 (restated)

(729)

17 520

40 566

(729)

58 086


46

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

NOTE 10 INCOME

NOTE 12 REVOLVING CREDIT FACILITY

10.1

The Company obtained a USD 75 million loan facility from Falcon Private Bank Ltd., Zurich and VP Bank Ltd., Vaduz on 11 May 2015. Should attractive investment opportunities arise, the Company would be able to anticipate a portion of the outstanding cash receivables from its sale of the “Legacy Portfolio” at the end of 2014 and thus accelerate its investment pace.

Net change in Fair Value of Unconsolidated Subsidiaries Change in fair value of unconsolidated subsidiaries was as follows: 2015

2014 (restated)

Fair value of unconsolidated subsidiary 1 January

31 007

19 798

Paid in capital

40 000

13 501

6 698

(2 758)

Unrealized gain/(loss) foreign exchange

3 680

Currency translation difference

(3 214)

77 705

31 007

2015

2014 (restated)

927

Unrealized gain/(loss) – fair value

Fair value of unconsolidated subsidiary 31 December

10.2

Interest Income

Interest income

The credit facility, if and when drawn, is secured by a pledge on the Company’s outstanding receivables from Strategic Partners VI Acquisitions G, L.P. Final maturity date for the credit facility is 29 December 2017 and may be extended to 30 June 2018. The credit line reduces from the original amount of USD 75 million to USD 37.4 million on 31 March 2017 and to zero on final maturity. As of 31 December 2015, the credit line has been drawn down for USD nil million.

Interest income of TUSD 927 (31 December 2014 (restated): nil) included in the carrying amount of the receivables (carried at amortized cost) related to the four equal deferred payments resulted from the sale of the “Legacy Portfolio” as of 31 December 2014.

The interest rate is LIBOR +3.0 % p.a and the commitment fee for the undrawn amount 1.25 % p. a.

NOTE 11 OTHER OPERATING EXPENSES

NOTE 13 TAXES 2015

Finance costs of TUSD 674 were accrued as of 31 December 2015.

2014 (restated)

2015

2014 (restated)

– Profit/(loss) before tax expense

5 870

(6 007)

– Applicable tax rate

7.8 %

7.8 %

458

(469)

Board of Directors expenses

544

477

Current income tax

SAR’s

398

466

Reconciliation of income tax calculated with the applicable tax rate:

Accounting

132

202

Consulting

36

195

Audit fees

151

232

236

232

842

1 030

2 340

2 835

Legal Other Total operating expenses

– Income tax Effect from: – non-taxable profits – unrecognized tax gain/(loss) – non-refundable withholding tax paid, income tax expense Total income tax expenses

(458)

469

In 2015, the Company paid nil (2014 (restated): nil) non-refundable withholding taxes. The Company did not recognize income tax assets in the form of losses that can be carried forward against future taxable income.


FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

Expiry of unrecognized tax losses

Amount

Within 1 year Within 2–4 years

14 377

Within 5–7 years

35 092

Total

174 955

No deferred tax assets are capitalized due to the inherent uncertainty of a refund which depends on achieving taxable net incomes in Switzerland in the foreseeable future.

2015

2014 (restated)

Net profit/(loss) per share outstanding from continuing operations – basic

0.85

(0.30)

Net profit/(loss) per share outstanding from continuing operations) – fully diluted

0.85

(0.30)

4 566

(1 621)

Weighted average of total number of shares outstanding – basic

5 355 841

5 360 529

Weighted average of total number of shares outstanding – diluted

5 355 841

5 360 529

Net profit/(loss) per share outstanding for the period from discontinued operations – basic

0.24

(0.82)

Net profit/(loss) per share outstanding for the period from discontinued operations – fully diluted

0.24

(0.82)

1 304

(4 386)

Weighted average of total number of shares outstanding – basic

5 355 841

5 360 529

Weighted average of total number of shares outstanding – diluted

5 355 841

5 360 529

Net profit/(loss) per share outstanding – basic

1.10

(1.12)

Net profit/(loss) per share – fully diluted

1.10

(1.12)

5 870

(6 007)

Weighted average of total number of shares outstanding – basic

5 355 841

5 360 529

Weighted average of total number of shares outstanding – diluted

5 355 841

5 360 529

Net profit/(loss) for the period from discontinued operations

Net profit/(loss) for the period

Related Parties are individuals and companies where the individual or company has the ability, directly or indirectly, to control the other party or to exercise significant influence over the other party in making financial and operating decisions. Related Parties include: • Board of Directors of Spice Private Equity Ltd; • GP Investments Group consisting of GP Investments Ltd. (Bermuda), GP Advisors (Bermuda) Ltd and GP Advisors Ltd, Zurich.

NOTE 14 EARNINGS PER SHARE ATTRIBUTABLE TO EQUITY HOLDERS

Net profit/(loss) for the period from continuing operations

NOTE 15 RELATED PARTY TRANSACTIONS

125 486

Material transactions Expense of TUSD 544 (31 December 2014 (restated): TUSD 477) were booked during the reporting period for Board of Directors compensation and travel expenses. SARs expenses of TUSD 398 (31 December 2014 (restated): TUSD 466) were booked during the reporting period. Board of Directors members did not received any new SARs during 2015. Administration fee expenses and payments to GP Advisors Ltd, Zurich amounted to TUSD 103 (31 December 2014 (restated): TUSD 109) in the reporting period. In the reporting period the unconsolidated subsidiary paid management fee of USD 5.4 million (31 December 2014 (restated): USD 3.7 million) to GP Advisors (Bermuda) Ltd. During 2015, through two secondary transaction bidding processes, the unconsolidated subsidiary acquired from third parties LP stakes in four funds managed by GP Investments. GP Advisors (Bermuda) Ltd is entitled to a performance fee of 10 % of the increase, if any, in the Company’s NAV after a 5 % hurdle and subject to customary catch-up and high-watermark clauses. The high-watermark was reset to the USD value of the Company’s NAV as of 31 December 2014 of USD 203.6 million to reflect the new structure and size of the Company after the sale of the “Legacy Portfolio”. No performance fees have been accrued or paid as of 31 December 2015 and 2014.

47


48

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

NOTE 16 FINANCIAL RISK MANAGEMENT 16.1 Strategy in Using Financial Instruments The investment objective of the Company is to realize longterm capital appreciation, investment income or both by creating a portfolio of Direct Investments and Fund Investments in the private equity sector. The investments will be diversified among fund managers, geographical regions, economic sectors and stages through its unconsolidated subsidiaries. Although the Company may invest directly in Fund Investments or companies, it is anticipated that investments will generally be made through Spice Private Equity (Bermuda) Ltd. The Company’s activities expose it to a variety of financial risks, namely market risk (including interest rate risk, currency risk and other price risks), liquidity risk and credit risk. Management observes and manages these risks. These risks could result in a reduction of the Company’s net assets. The Company seeks to minimize these risks and adverse effects by considering potential impacts from the financial markets. The Company manages these risks, where necessary, via collaboration with service partners that are market leaders in their respective area of expertise. Additionally, the Company has internal guidelines and policies in place to ensure that transactions are effected in a consistent and diligent manner. 16.2 Market Risk a) Interest rate risk The Company is subject to cash flow interest rate risk due to fluctuations in the prevailing levels of market interest rates. Changes in interest rates affect mainly financial assets (“Cash”) as well as financial liabilities. The majority of the Company’s assets and liabilities are non-interest bearing.

risks. Additionally, the Company regards loans in the same currencies as its assets as a measure to mitigate the impact of currencies on the Net Asset Value. The Company’s currency position is monitored on a regular basis and the FX exposure is reviewed by the Board of Directors at the quarterly meetings. As of 31.12.2015 in TUSD

b) Currency risk The Net Asset Value per share is calculated in USD, the functional and presentation currency of the Company. The Company’s underlying investments are largely denominated in USD. The Company is exposed to a certain degree of currency risk, which can adversely affect performance. Fluctuations in foreign currency exchange rates affect the Net Asset Value of the investments and therefore the Company. The Company can enter into currency contracts to mitigate these currency

CHF

Total

37 365

353

37 718

Receivables and prepayments

37 290

9

294

37 593

Receivables – non current

74 086

74 086

Unconsolidated subsidiaries at fair value through profit and (loss)

77 705

77 705

226 446

9

647

227 102

641

911

1 552

15 755

15 755

Provisions

283

283

Total liabilities

924

16 665

17 589

USD

GBP

CHF

Total

Cash and cash equivalents

46 438

213

46 651

Receivables and prepayments

37 155

168

37 323

110 548

110 548

Total assets Liabilities Payables and accrued charges Put option liability

As of 31.12.2014 (restated) in TUSD

Assets

Receivables – non current Unconsolidated subsidiaries at fair value through profit and (loss) Total assets

31 007

31 007

225 148

381

225 529

2 732

1 532

4 264

15 736

15 736

1 912

1 912

4 644

17 268

21 913

Liabilities Put option liability Provisions Total liabilities

The Manager monitors interest rates on a regular basis and informs the Board of Directors accordingly at its quarterly meetings.

GBP

Cash and cash equivalents

Payables and accrued charges

The Company ist not subject to significant amounts of risk due to fluctuation in the prevailing levels of market interest rates.

USD

Assets

c) Other price risks Other price risks (i. e. changes in market prices other than from interest rate risks or currency risk) may affect the value of the unconsolidated subsidiary carried at fair value through profit or loss. Other price risks arise mainly from the uncertainty about future valuations of the underlying investments held by the Subsidiary. For the unconsolidated subsidiary the Company determines the corresponding fair value on a monthly basis. Please see Note 2 “Accounting Policies” for more information on the fair value process as well as Note 3 “Investment Table (Unconsolidated Subsidiary)”.


FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

The Company attempts to minimize the investment risk incurred at level of its unconsolidated subsidiary through effective due diligence prior to investing, conservative underwriting, reviews of investment partners, and contractual provisions that limit the Company’s downside risk.

Cash in hand is in excess of 100 % of all unfunded commitments. Management monitors cash flows on a weekly basis by updating its cash flow report and reports at least on a quarterly basis to the Board of Directors. The table below summarizes the Company’s payables (gross undiscounted cash-flows).

The Company’s investment advisor performs extensive due diligence prior to recommending any direct or fund investment including an analysis of the potential risks of the investment. The Manager monitors investments by analyzing regular reports and through direct contact with General Partners and company management. Investment recommendations are approved by the Investment Committee of the Manager and the Board of Directors of the Subsidiary prior to commitment. Investment performance is reviewed regularly by the Manager and the Board of Directors. Valuations are updated on a monthly basis by taking new currency rates, stock price at the end of the month for listed portfolio companies and new reports from portfolio funds available to the Manager into account. Furthermore the Manager discusses fund performance with the fund managers and may take part in the annual meetings of significant portfolio funds. Detailed valuations are established quarterly/semi-annually by the fund managers. The Board of Directors reviews and subsequently approves the valuations.

As of 31.12.2015

Changes in valuations can have an impact on net profit. In order to demonstrate the sensitivity, the average change of the TR LPX50® index (one of the leading benchmarks for the listed private equity industry) of the past two years is calculated and used as input to the sensitivity analysis. If the value of the investments (based on year-end values) had increased or decreased by 12.2 % with all other variables held constant, the impact on the Shareholders’ Equity and net income would have been USD 8.0 million (2014: 13.4 %, USD 2.2 million). The Group is exposed to a variety of market risk factors which may change significantly over time. As a result, measurement of such exposure at any given point in time may be difficult given the complexity and limited transparency of the underlying investments. Therefore, a sensitivity analysis is deemed to be of limited explanatory value. 16.3 Liquidity Risk Due to the specific nature of private equity funds of the type in which the Company invests through its unconsolidated subsidiaries, immediate and full investment of assets is not always possible. Commitments made by a private equity investor in a private equity fund typically result in actual investments being made over a period of up to five years. Outstanding commitments entered into at unconsolidated subsidiaries level amounted to USD 29.2 million at year-end 2015 (2014: USD 16.4 million).

Payables and accrued charges

On demand

1 552

Put option liability

15 755

Total

17 306

Unfunded commitments

29 160

As of 31.12.2014 (restated)

On demand

Payables and accrued charges

4 264

Put option liability

15 736

Total Unfunded commitments

20 000 16 396

16.4 Credit Risk The Company has credit exposure only to established, creditworthy third parties, so that no collateralization is required. Receivables are monitored continuously. The Board of Directors monitors credit risk on a regular basis. The Company holds cash with a number of internationally renowned financial institutions for diversification reasons. The Company monitors the standing of these institutions on a regular basis. The minimum credit rating of these institutions at year-end 2015 was “A” (Standard & Poor’s). As of 31 December 2015 the Company has a significant outstanding receivables balance with Strategic Partners VI Acquisitions G, L.P. (a special purpose vehicle majority owned by Strategic Partners Fund VI, L.P.) resulting in a concentration of credit risk with one counter party. The receivable was recognized as a result of the disposal of the “Legacy Portfolio” through the sale of two Company subsidiaries, APEN Faith Media Holdings LLC and APEN Holdings LLC. The credit risk is mitigated by a multiple layer guarantee structure with the ultimate majority guarantor being Strategic Partners Fund VI, L.P., a USD 4.4 billion private equity secondary fund managed by Strategic Partners Fund Solutions, Blackstone’s dedicated secondary and fund solutions platform.

49


50

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

As of 31.12.2015

Neither past due nor impaired

2015 Total carrying amount

Cash and cash equivalents

37 718

37 718

Receivables and prepayments

37 593

37 593

Receivables non-current Total financial assets (excl. investments)

74 086

74 086

149 397

149 397

Neither past due nor impaired

2014 Total carrying amount

As of 31.12.2015

Level 1

Level 2

Unconsolidated subsidiaries at fair value through profit and (loss)

77 705

77 705

Total

77 705

77 705

Level 3

Total

As of 31.12.2014 (restated)

Cash and cash equivalents

46 651

46 651

Unconsolidated subsidiaries at fair value through profit and (loss)

Receivables and prepayments

37 323

37 323

Total

As of 31.12.2014 (restated)

Receivables non-current

110 548

110 548

Total financial assets (excl. investments)

194 522

194 522

16.5 Fair Value Estimation In addition to the fair value approach highlighted in Note 2.5.6, IFRS requires the Company to disclose fair value measurements by level of the following fair value measurement hierarchy: Level 1 – inputs to the valuation methodology are quoted prices available in active markets for identical investments as of the reporting date. The type of investments listed under Level 1, include unrestricted securities listed in active markets. Level 2 – inputs to the valuation methodology are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date. Investments which are included in this category include restricted securities listed in active markets, securities traded in other than active markets, derivatives, corporate bonds and loans. Level 3 – inputs to the valuation methodology are unobservable and significant to overall fair value measurement. The inputs into the determination of fair value require significant management judgment or estimation. Investments that are included in this category include investments in privately held entities. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Management’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. The following table summarizes the Company’s investments measured at fair value on a recurring basis by the above fair value hierarchy levels:

Level 3

Total

Level 1

Level 2

31 007

31 007

31 007

31 007

Due to the nature of the business the Company is engaged in, there are no transfers between level 1, 2 and 3 assets. Level 3 investments consist of the unconsolidated subsidiaries. These are by nature unquoted. The fair values of these unquoted subsidiaries is derived based on the Net Asset Value of the underlying investments considering also inherent leveraging with financial liabilities appropriately, as outlined in Note 2.5.6. Most inputs used to derive the adjusted underlying Net Asset Value of the investments are unobservable (including adjustments that are calculated by the fund manager for the underlying investments). For year-end 2015 the Company used 30 September 2015, quarterly reports (unaudited) as input parameters for its investments. In cases where September reports were used, the Company calculated the year-end fair value of a specific fund or direct investment by adding (cash paid) and subtracting (cash received) fourth quarter activity to the investment’s September capital account balance. Additionally, a mark to market adjustment is applied if funds or direct investments are invested in listed quoted securities which are traded in active markets. 2015 activity is also reviewed for any significant developments that may have an impact on the year-end valuation. The following table discloses the changes to the fair value of Level 3 assets during the year:

Level 3 assets fair value at 1 January Capital distribution Capital contribution Unrealized gain/(loss) of Level 3 assets (incl. FX impact)

2015

2014 (restated)

31 007

234 662

40 000

13 501

6 698

922

Realized gain/(loss) of Level 3 assets (incl. FX impact)

(15 092)

Disposal of Level 3 financial assets

(177 221)

Currency translation differences

(25 765)

77 705

31 007

Level 3 assets fair value at 31 December


51

FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

As outlined in Note 2.5.6, the Company does not utilize valuation models with model inputs to calculate the fair value for their Level 3 investments. Rather, the Company utilizes a methodology that uses NAV as the key input. Thus, the main “unobservable input” would be NAV itself. Assets and liabilities not carried at fair value but for which fair value is disclosed are a reasonable approximation of fair value.

Movements in the number of Stock Appreciation Rights (SARs) and their related exercise prices are as follows:

SARs

2014 Average exercise price per share (restated)

As of January 1

20.02 179 000

18.82

Granted

25.37

37 000

23.57

45 000

Exercised

26.12 (40 000)

24.58

(4 000)

19.76 176 000

20.02

179 000

2015 Average exercise price per share

Expired

As of 31 December

SARs

138 000

NOTE 17 SHARE-BASED COMPENSATION PLAN Stock Appreciation Rights (SARs) A total of 220 000 SARs were issued to members of the Board of Directors and GP Advisors employees. Outstanding SARs as of 31 December 2015 were 176 000 and are split as follows: Number of SARs

Of the outstanding 176 000 SARs (2014: 179 000), 96 325 SARs (2014: 108 663) were exercisable per 31 December 2015. In 2015, 44 332 SARs vested without being exercised (2014: 12 663). A number of 40 000 SARs (40 000 SARs granted in 2011) were exercised in 2015 (2014: 4 000 SARs).

Year of grant

Vesting date

Expiry

Subscription ratio

Strike price

8 000

2011

Vested

12.1.2016

1:1

CHF 16.76

48 000

2012

Vested

12.1.2017

1:1

CHF 17.24

25 329

2013

Vested

21.8.2018

1:1

CHF 23.19

12 671

2013

21.8.2016

21.8.2018

1:1

CHF 23.19

14 996

2014

Vested

3.9.2019

1:1

CHF 23.42

14 999

2014

3.9.2016

3.9.2019

1:1

CHF 23.42

Model input variables

2015 SARs

2014 SARs

2013 SARs

2012 SARs

2011 SARs

15 005

2014

3.9.2017

3.9.2019

1:1

CHF 23.42

Dividend yield

0 %

0 %

0 %

0 %

0 %

Expected volatility

20.03 %

17.50 %

15.94 %

16.75 %

27.55 %

1.647 %

(0.481 %)

(0.594 %)

(0.693 %)

(0.798 %)

4.42 years

3.68 years

2.64 years

1.04 years

0.03 years

12 330

2015

1.6.2016

1.6.2020

1:1

USD 25.37

12 335

2015

1.6.2017

1.6.2020

1:1

USD 25.37

12 335

2015

1.6.2018

1.6.2020

1:1

USD 25.37

The SARs were granted free of charge. Each SAR entitles the holder to receive in cash the difference between the strike price and the market price of one share of the Company at the exercise date. For SARs originally issued with a strike price in CHF (i. e., year of grant of 2011 – 2014) the above difference is calculated separately for the periods before and after the change of the listing currency from CHF to USD on 20 May 2015. Payout to the holder is based on the sum of the differences for the two periods. A third of the SARs are each exercisable after a vesting period of one, two and three years. The SARs expire after five years. In case of a termination of the working contract during the vesting period, the SARs are cancelled. The Company has agreed to change of control clauses for the beneficiaries with respect to SARs, in that vesting may be immediate in a change of control situation (this policy has been applied to all SARs issued in 2011 and 2012).

In the current year, TUSD 398 (2014 (restated): 466) was charged as an expense relating to SARs within other operating expenses in the Statement of Comprehensive Income. The carrying amount of the liability at the end of the period amounted to TUSD 693 (2014 (restated): 655). The following table lists the inputs in the models used for the plan for the year ended 31 December 2015:

Risk-free interest rate Expected life of option/ SARs Weighted average share price Model used Exercise multiple

Hull-White

Hull-White

Hull-White

Hull-White

Hull-White

2

2

2

2

2

Since market implied volatilities for Spice Private Equity Ltd are not available, the average of the historical volatility of a basket of peer Companies was determined (for 2015 SARs: 15.10 %, 2014 SARs: 13.39 %, 2013 SARs: 12.44 %; for 2012 SARs: 12.57 % and for 2011 SARs: 14.49 %). Additionally, a historical volatility estimate of the Company, using a time window of observations equal to 4.42 years was calculated at 24.96 % (for 2015 SARs), 3.68 years at 21.62 % (for 2014 SARs) 2.64 years at 19.44 % (for 2013 SARs) 1.04 years at 20.92 % (for 2012 SARs) and 0.03 years at 40.60 % (for 2011 SARs). For calculation purposes the average of the two values was taken.


52

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

NOTE 18 COMMITMENTS, CONTINGENCIES AND OTHER OFF-BALANCE SHEET TRANSACTIONS

NOTE 20 SUBSEQUENT EVENTS

In addition to those commitments disclosed in Note 16.3 the Company has nil off-balance-sheet transactions open as of 31 December 2015 (2014: nil). The operations of the Company may be affected by legislative, fiscal and regulatory developments for which provisions are made where deemed necessary. Please refer to Note 16.3 “Liquidity Risk” for additional information on commitments. Customary representations and warranties related to the sale of the “Legacy Portfolio” were given to the purchaser by the Company.

Since the balance sheet date of 31 December 2015, there have been no material subsequent events that could impair the integrity of the information presented in the financial statements. Between 1 January 2016 and 16 February 2016, the following aggregate investment related cash flows have been recorded (by the partnerships under the commitments existing as of 31 December 2015 and Direct Investments): TUSD

Capital calls Capital distributions

NOTE 19 SEGMENT REPORTING After the sale of the “Legacy Portfolio” the only operating segment remaining was the emerging markets. Therefore as of 31 December 2014 the Management determined that the Group has operated in the sole operating segment of private equity investments in emerging markets. The geographical analysis of total assets is determined by specifying in which region the investment was made: in TUSD

2015

2014 (restated)

USA 1)

111 291

147 632

Bermuda

77 705

31 007

Switzerland Total

38 106

46 890

227 102

225 529

Corresponding to receivable from the “Legacy Portfolio” sale and other receivables.

1)

The geographical analysis of total income is determined by specifying from which region the profits are generated: in TUSD

USA Bermuda Switzerland Total

2015

2014 (restated)

927

6 698

3 680

58

401

7 682

4 081

(891) 61


FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

REPORT OF THE STATUTORY AUDITOR ON THE FINANCIAL STATEMENTS (IFRS) – SPICE PRIVATE EQUITY LTD

As statutory auditor, we have audited the accompanying financial statements of Spice Private Equity Ltd, which comprise the balance sheet, statement of comprehensive income, statement of cash flows, statement of changes in shareholders’ equity and notes (pages 28 to 52), for the year ended 31 December 2015. Board of Directors’ responsibility The Board of Directors is responsible for the preparation and fair presentation of the financial statements in accordance with the International Financial Reporting Standards (IFRS), the Article 14 of the Directive on Financial Reporting (DFR) of SIX Swiss Exchange and the requirements of Swiss law. This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. The Board of Directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances. Auditor’s responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Swiss law and Swiss Auditing Standards as well as the International Standards on Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control system. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion, the financial statements for the year ended 31 December 2015 give a true and fair view of the financial position, the results of operations and the cash flows in accordance with the International Financial Reporting Standards (IFRS) and comply with the Article 14 of the Directive on Financial Reporting (DFR) of SIX Swiss Exchange Swiss law. Report on other legal requirements We confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and independence (article 728 CO and article 11 AOA) and that there are no circumstances incompatible with our independence. In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists which has been designed for the preparation of financial statements according to the instructions of the Board of Directors. We recommend that the financial statements submitted to you be approved. PricewaterhouseCoopers AG Daniel Pajer Audit expert Auditor in charge

Zurich, 17 February 2016

Martin Gubler Audit expert

53


CORPORATE GOVERNANCE


56

ANNUAL REPORT 2015  CORPORATE GOVERNANCE

CORPORATE GOVERNANCE AT SPICE PRIVATE EQUITY LTD

Preliminary remark: Spice Private Equity Ltd (the Company) (formerly APEN Ltd) changed its company name during 2015. This name change was adopted by the Extraordinary General Meeting (EGM) held on 26 February 2015. 1. GROUP STRUCTURE AND SHAREHOLDERS Spice Private Equity Ltd Spice Private Equity Ltd is a holding company according to Swiss law and has its registered office at Industriestrasse 13c, 6300 Zug, Switzerland.

Group Structure as of 31 December 2015 The Company owns all shares in Spice Private Equity (Bermuda) Ltd through which investments are made exclusively in emerging markets, covering various regions, in particular Asia-Pacific, Sub-Saharan Africa and Latin America.

Organizational Structure as of 31 December 2015

GP INVESTMENTS

NEWBURY PARTNERS

FORTRESS ENTITIES

OTHER

(SHAREHOLDER)

(SHAREHOLDER)

(SHAREHOLDER)

SHAREHOLDERS

100 % GP ADVISORS LTD, ZURICH

1

SPICE PRIVATE EQUITY LTD, ZUG*

BoD***

2

100 % GP ADVISORS (BERMUDA) LTD

100 % SPICE PRIVATE EQUITY

IC****

(BERMUDA) LTD**

3

1

Administration Agreement between GP Advisors Ltd, Zurich and Spice Private Equity Ltd

2

Advisory Agreement between GP Advisors Ltd, Zurich and GP Advisors (Bermuda) Ltd

3

Investment Management Agreement between GP Advisors (Bermuda) Ltd and Spice Private Equity (Bermuda) Ltd

* ** *** ****

Spice Private Equity Ltd, formerly APEN Ltd Spice Private Equity (Bermuda) Ltd, formerly APEN Bermuda EM Ltd Board of Directors Investment Committee


CORPORATE GOVERNANCE  ANNUAL REPORT 2015

Significant Shareholders There are several shareholders with a reported participation exceeding the 3 % threshold of the Company’s share capital. The number of shares and voting rights of the major shareholders are disclosed in Note 8 of the IFRS financial statements. Disclosure notices relating to persons or groups with significant shareholdings (more than 3 % of voting rights) can be found at: https://www.six-exchange-regulation.com/en/home/ publications/significant-shareholders.html Cross Shareholdings There are no cross-shareholdings with other companies.

2. CAPITAL STRUCTURE Capital As of 31 December 2015, the issued share capital of the Company, as registered in the commercial register, was CHF 53 637 170, divided into 5 363 717 fully paid registered shares with a nominal amount of CHF 10.00 each. As per the same date, the Company held 6 395 shares as treasury shares. The reserves from capital contributions (statutory reserves) amounted to CHF 384.5 million and the market capitalization to CHF 130.9 million. The shares are listed on the SIX Swiss Exchange (ISIN: CH0009153310). Changes of Capital In June 2013 the share capital was increased by CHF 12 387 170 through the issuance of 1 238 717 new shares with a nominal value of CHF 10.00 each by utilizing the authorized share capital. There were no further share capital increases or other changes to the share capital during the last three reporting years.

Authorized and Conditional Capital The Board of Directors is entitled to an increase in authorized capital up to a maximum amount of CHF 26 818 580 by issuing no more than 2 681 858 shares with a nominal value of CHF 10.00 each. The authorization expires on 26 May 2017. Shares for which subscription rights were granted but not executed are at the Board of Director’s disposal. The pre-emptive rights of the shareholders can be excluded in case of acquisitions of other companies or additional listings on foreign stock exchanges. The share capital may be increased from conditional capital in connection with the exercise of conversion or option rights, which are granted in connection with bonds or similar debt instruments up to a maximum amount of CHF 26 818 580 by issuing no more than 2 681 858 shares with a nominal value of CHF 10.00 each. In connection therewith, the shareholders’ pre-emptive rights are excluded. Whenever options or conversion rights are issued, the Board of Directors shall be entitled to withdraw the preferential subscription rights of shareholders for valid reasons. For further details see also Article 4b and 4c of the Articles of Association available on the Company website. Limitations of Transferability The Company’s shares are freely transferable, without any limitations, provided that the buyers declare they are the beneficial owners of the shares. See also Article 4 of the Articles of Association available on the Company website. Convertible Bonds and Warrants/Put and Call Options/ right of First Refusal Put and call option of Drawbridge Special Opportunities Fund

Shares and Participation Certificates There are no shares with preferential rights or similar rights. Each share is entitled to one vote and has full dividend rights. voting rights may be exercised only after a shareholder has been registered in the Company’s share register. No shares and/or share certificates will be physically issued to shareholders. Transfers of shares are effected through a book-entry system maintained by SIX SIS Ltd.

Pursuant to the Subscription Agreement dated 17 May 2013 between Drawbridge Special Opportunities Fund LP, New York, NY, USA (“Fortress-Drawbridge”) and the Company, Fortress-Drawbridge has the right to sell to the Company 717 266 shares acquired in connection with the implementation of the new corporate structure in 2013. This right to sell may be exercised for the first time on 12 June 2014 and not later than 12 June 2018 (provided that such exercise period shall be extended up to the date, when the Company may purchase such shares in compliance with the relevant rules of the Swiss Code of Obligations governing the acquisition of own shares). The exercise price is CHF 21.80 per share.

There are neither participation certificates nor profit sharing certificates.

The Subscription Agreement also provides that the Company has the right to buy from Fortress-Drawbridge the 717 266

57


58

ANNUAL REPORT 2015  CORPORATE GOVERNANCE

shares. This right to buy may be exercised for the first time on 12 June 2014 and not later than 12 June 2018. The exercise price shall be CHF 41.50 per share. Right of first refusal of GP Swiss Ltd Pursuant to the Subscription Agreement dated 17 May 2013 between GP Swiss Ltd (formerly GP Secondaries Investment Company (Switzerland) Ltd) a subsidiary of GP Investments Ltd and the Company, the Company grants to GP Swiss Ltd, for as long as GP Swiss Ltd holds at least 10 % of the share capital of the Company outstanding from time to time, but in no event for longer than two years after the put and call arrangement (referred to above) shall have expired, a right of first refusal with respect to any shares acquired by the Company under the above mentioned put and call arrangement. The right of first refusal entitles GP Swiss Ltd to purchase the relevant number of shares previously transferred to the Company upon exercise of the put option or the call option, in the event that the Company were to sell or otherwise directly or indirectly transfer, all or a part of such shares to an independent third party. If GP Swiss Ltd exercises its right of first refusal, it will pay the same price as the third party offered to pay for the relevant shares or, in the absence of such a third party offer, the bona fide price and terms offered by the Company.

3. BOARD OF DIRECTORS Responsibilities The Board of Directors consists of one or more members. The Board of Directors is ultimately responsible for the policies and Management of the Company. The Board of Directors establishes the strategic, accounting, organizational and financing policies of the Company. The Board of Directors further determines the authorized signatories of the Company and their signing authority. The Board of Directors is entrusted with preparing meetings of the shareholders and carrying out Shareholders’ Resolutions. Since 1 July 2013, the Board of Directors has discontinued the delegation to a Management Board of the day-to-day operations of the Company and has carried out these functions by itself. Meeting Schedule The Board of Directors usually meets four times per year in person (minimum twice). The regular meetings are typically held in March, May, August and November. Additional meetings are called on short notice if and when required. In the year under review, four board meetings took place. Each of the regular board meetings has a special focus which is basically connected to the Company’s reporting rhythm. Such focuses are the financial statements, interim results, the medium-term

plan, foreign exchange exposure, the Annual General Meeting (AGM) and corporate governance. The Board of Directors resolves by majority vote with the presence of a majority of members. The average duration of a board meeting is ninety minutes. Principles of the Election Procedure The members of the Board of Directors as well as the Chairman of the Board of Directors are elected by the Annual General Meeting (AGM) according to Articles 10 and 11 of the Articles of Association available on the Company website. The members of the Board of Directors are elected for a term of office of one year (or, in case of an election at an Extraordinary General Meeting (EGM), for a term of office until the next Annual General Meeting (AGM)), with the possibility of repeated re-election. Members of the Board of Directors Eduardo Leemann, born 1956, Swiss citizen, Chairman, executive member, term of office expires in 2016. Mr. Leemann joined Falcon Private Bank Ltd. (formerly AIG Private Bank) in 1997 as Chief Executive Officer in Zurich serving later as Chairman of the Board. He returned to the Executive Board of the Bank in September 2008 and is now appointed Chief Executive Officer of Falcon Private Bank. He previously worked at Goldman, Sachs & Co Bank as Member of the Management Committee and Head of Private Banking. Prior to that, Eduardo Leemann was Deputy to the Head of Private Banking worldwide at Bank Julius Baer with direct responsibilities for the Western Hemisphere, Switzerland as well as the overall marketing effort in Private Banking. Prior to that, he was responsible for building the private banking business of Bank Julius Baer in their New York branch. Eduardo Leemann is a graduate of the Swiss School of Economics and Business Administration (SEBA) and the Advanced Executive Program of the J.L. Kellogg Graduate School of Management at Northwestern University in Chicago, USA. Mr. Leemann joined Company’s Board of Directors and became its Chairman in September 1999. Antonio Carlos Augusto Ribeiro Bonchristiano, born 1967, Brazilian citizen, Vice-Chairman, executive member, term of office expires in 2016. Mr. Bonchristiano is a member of the board and CEO of GP Investments Ltd and a member of the Investment Committee of GP Advisors (Bermuda) Ltd. He joined GP Investments in 1993 and has been a Managing Director since 1995. Prior to joining GP Investments, Mr. Bonchristiano


CORPORATE GOVERNANCE  ANNUAL REPORT 2015

was a Partner at Johnston Associates Inc., a finance consultancy based in London, and worked for Salomon Brothers Inc. in London and New York. Currently, he serves as a member of the Boards of Directors of AMBEV, Lupatech, GP Advisors and GP Investments Acquisition Corp. Mr. Bonchristiano is also on the board of several non-profit organizations, including: Fundação Bienal and Fundação Estudar in São Paulo, Brazil and John Carter Brown Library in Providence, RI, USA. Previously, he served as a member of the Boards of Directors of Allis, BHG, Estácio, BR Properties, LAHotels, Sé Supermercados, ALL, Kuala, CEMAR, ABC Supermercados, Gafisa, Hopi Hari, Submarino, Equatorial, Geodex Commumication, Trio Assessoria (holding Sascar), BR Malls, Tempo, Magnesita Refratários, and Playcenter. He was also previously the Chief Financial Officer of SuperMar Supermercados and Founder and Chief Executive Officer of Submarino. He was further Vice-Chairman of the Board of Directors of BR Properties, Director of Geodex Communication, Contax Participações and IRO of ABC Supermarkets and GP Investments, Ltd. Mr. Bonchristiano holds a Bachelor’s degree in Politics, Philosophy, and Economics from the University of Oxford. Mr. Bonchristiano joined the Company’s Board of Directors in June 2013. Please see “Administrative Services and Investment Management” below for a description of the significant business connections between subsidiaries of the Company and the GP Investments group. David Justinus Emery, born 1962, Swiss citizen, executive member, term of office expires in 2016. Mr. Emery is the Founder and Chairman of Reciprocus International Pte Ltd, a Global M&A Advisory Boutique based in Singapore. Prior to setting up his own firm in October 2011, he was with Dun & Bradstreet, Inc (D&B) for over 16 years, lastly as Member of the Group’s Executive Board (GLT), President of Asia-Pacific and Head of International Business Development and M & A. Mr. Emery serves today as an advisor to several organizations and government agencies and sits on several boards. He is also an entrepreneur in his own right, mainly as an early stage investor. He holds a Swiss Federal Bachelor’s degree in Commerce and General Management. Mr. Emery joined the Company’s Board of Directors in June 2013. During the two years prior to his election to the Board of Directors, Mr. Emery (through Reciprocus International Pte Ltd) served as advisor to the Company. In 2015, Reciprocus International Pte Ltd, received no fees.

Fersen Lamas Lambranho, born 1961, Brazilian and Portuguese citizen, executive member, term of office expires in 2016. Mr. Lambranho is a member of the board and Chairman of GP Investments. He joined the firm in 1998 and became a managing director in 1999. Prior to joining GP, Mr. Lambranho was CEO of Lojas Americanas, where he worked for 12 years and was a board member from 1998 to 2003. Currently, he is Chairman of the Board of Magnesita. He has served as chairman of the boards of Oi, Contax, Gafisa and ABC Supermercados. Mr. Lambranho serves on the boards of Centauro, BRZ Investimentos, GP Advisors and GP Investments Acquisition Corp. He previously served on the board of BRMalls, San Antonio, Allis, Estácio, Tele Norte Leste Participações, São Carlos Empreendimentos e Participações, Playcenter, Shoptime, Farmasa, BR Properties and Americanas.com. He is a board member of several non-profit entities, such as Fundação Bienal de São Paulo e COPPEAD-UFRJ. Mr. Lambranho holds a bachelor’s degree in civil engineering from the Universidade Federal do Rio de Janeiro and a MSc degree in business administration from COPPEAD-UFRJ. He also completed the Owner President Management Program at the Harvard Business School. Mr. Lambranho joined the Company’s Board of Directors in February 2015. Please see “Administrative Services and Investment Management” below for a description of the significant business connections between subsidiaries of the Company and the GP Investments group. David Pinkerton, born 1961, US citizen, executive member, term of office expires in 2016. Mr. Pinkerton joined Falcon Private Bank Ltd. in October 2010 as Chief Investment Officer. Previously, he was a Managing Director in the Alternative Investments Group at AIG Investments in New York. Mr. Pinkerton also set up a successful external asset management business in New York to provide consulting services and manage family investments. He has over 31 years of far-reaching experience and expertise in private equity and hedge funds. David B. Pinkerton holds a Bachelor’s Degree in Finance and Economics from the University of Delaware and is admitted to New York and New Jersey State Bar. Mr. Pinkerton joined the Company’s Board of Directors in June 2010. None of the members of the Board of Directors was in the three financial years preceding the period under review (i. e. the financial year 2015) a member of the Management of

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ANNUAL REPORT 2015  CORPORATE GOVERNANCE

the Company or one of the Company’s subsidiaries. Further, neither Mr. Leemann nor Mr. Pinkerton nor Mr. Emery has significant business connections with the Company or one of the Company’s subsidiaries. Internal Organisation In connection with the implementation of the new corporate structure as of 1 July 2013, the Board of Directors decided to discontinue the delegation to the Management Board of the day-to-day operations of the Company. Since 1 July 2013, the Board of Directors carries out these functions by itself. In view of the lean structure of the Company, the Board of Directors did not constitute any committees, except for the compensation committee. Due to its relatively narrow business activities and the investment management arrangements with GP Advisors (Bermuda) Ltd, the Company does not have dedicated internal audit personnel. Risks are managed via a variety of measures. These include various regulations that are reviewed by the Board of Directors on a regular basis.

nature. Under this agreement, the Company shall pay to GP Advisors Ltd an annual fee of CHF 100 000 plus out-of-pocket expenses reasonably incurred. In 2013, Spice Private Equity (Bermuda) Ltd entered into an Investment Management Agreement with GP Advisors (Bermuda) Ltd in respect to services to be provided for its investment portfolio. The Investment Management Agreement empowers, inter alia, GP Advisors (Bermuda) Ltd to take investment decisions on behalf of Spice Private Equity (Bermuda) Ltd. The agreement has an initial life of 7.5 years starting on 1 July 2013. In essence, Spice Private Equity (Bermuda) Ltd, pays to GP Advisors (Bermuda) Ltd a management fee of CHF 5 mio per annum and a performance fee of 10 % of the increase, if any, in the Company’s NAV after a 5 % hurdle and subject to customary catch-up and high-watermark clauses. The highwatermark was reset to the USD value of the Company’s NAV as of 31 December 2014 (USD 203.6 million) to reflect the new structure and size of the Company after the sale of the “Legacy Portfolio”. No Performance Fees have been accrued or paid as of 31 December 2015 up to that point.

The Company is exposed to a variety of risks such as: In more detail, the fees are calculated as follows: • Liquidity risk (financing of unfunded commitments, loan servicing etc.); • Currency risk; • Investment related risks; and • Financial reporting by portfolio company. The Board of Directors discusses these risks on a quarterly basis at the board meetings and develops measures where required. The Company has set up its own internal control system, which is updated and reviewed on an annual basis. For the tasks and responsibilities of the Board of Directors see internal regulations of the Board of Directors available on the Company website. Administrative Services and Investment Management In 2013 Spice Private Equity (Bermuda) Ltd entered into a Services Agreement with Codan Services Ltd. in respect to administrative services to be provided in Bermuda. In 2013, the Company and GP Advisors Ltd (formerly APEN Services GmbH) amended their agreement on administrative services to be provided to the Company. Under the agreement, the Company issued a power-of-attorney to GP Advisors Ltd staff to handle matters of a mere administrative

As of 1 January 2015, the investment management agreement was modified and provides, as of that date, in essence that Spice Private Equity (Bermuda) Ltd shall pay to GP Advisors (Bermuda) Ltd a management fee and a performance fee on a modified basis (compared to the regime applicable until 31 December 2014). The management fee per quarter shall be calculated as follows: (a) during the period from 1 January 2015 to 31 December 2018 (“Initial Period”), the management fee shall be equal to the sum of (i) CHF 1 250 000 plus (ii) 1/4  of 1.5 % of the New Capital Amount (meaning the total amount of capital raised by the Company from the issuance and sale of ordinary registered shares or other securities of the Company after 1 January 2015) and (b) after the Initial Period, be equal to 1/4 of 1.5 % of the Company’s NAV. The performance fee shall be calculated on the basis of the Excess Return (meaning the excess, if any, of (A) the Company’s NAV as of the relevant calculation date over (B) the sum of (x) the Company’s NAV as of the most recent reference date, increased at an annual rate of 5 %, compounded annually, from such reference date through such calculation date, plus (y) the aggregate value of each Contribution (meaning a transfer of cash or securities into the Company in payment or exchange for its capital stock, or as a Contribution with


CORPORATE GOVERNANCE  ANNUAL REPORT 2015

respect to its capital stock) during the period from such reference date through such calculation date, increased in each case at an annual rate of 5 % from the date of such Contribution through such calculation date, less (z) the aggregate value of each Distribution (meaning a transfer of cash or securities from the Company as a dividend or Distribution with respect to its capital stock, or in a redemption or repurchase of it capital stock) during the period from such reference date through such calculation date, decreased in each case at an annual rate of 5 % from the date of such Distribution through such calculation date) as follows: (i) first, 100 % of such Excess Return shall be allocated to GP Advisors (Bermuda) Ltd until GP Advisors (Bermuda) Ltd has been allocated for the relevant calendar semester an amount at least equal to 10 % of the Excess NAV Amount (meaning, with respect to any calculation date, the excess, if any, of (A) the Company’s NAV as of such calculation date over (B) the sum of (x) the Company’s NAV as of the most recent reference date plus (y) the aggregate value of each Contribution during the period from such reference date through such calculation date, less (z) the aggregate value of each Distribution during the period from such reference date through such calculation date) and (ii) second, 10 % of the remaining amount of such Excess Return shall be allocated to GP Advisors (Bermuda) Ltd. GP Advisors (Bermuda) Ltd entered into an Investment Advisory Agreement with GP Advisors Ltd, Zurich in respect of advisory services to be provided for the investment portfolio of the Company. Mandates in other Entities The number of mandates the members of the Board of Directors may exercise as member of the top governing or administrative body of other entities which are required to register with the Swiss Commercial Register or a similar foreign register according to Article 12 para. 1 subpara. 1 of the ordinance against excessive compensation in listed joint stock companies (VegüV, ORAb) can be found in Article 13a of the Articles of Association of the Company. The Articles of Association of the Company are available on the Company website.

administrative services to be provided to the Company. The former Chief Executive Officer of the Company, Mr. David Salim together with Dr. Guido Cornella, assumed main responsibility for the administrative services under the Services Agreement. Neither Mr. Salim nor Dr. Cornella has any managerial functions within the Company or its subsidiaries. The Company will nevertheless continue to disclose in the corporate governance report information regarding the responsible employees of GP Advisors Ltd, Zurich. Responsible Employees of GP Advisors Ltd, Zurich David Salim, born 1965, Swiss citizen. Mr. Salim was, before joining GP Advisors Ltd, Zurich in July 2013, Chief Executive Officer of the Company from August 2010 until June 2013. He has over 20 years of professional experience in investment banking and investment management with international financial groups and as an independent advisor. Since 1999, he has been active in alternative investments and in particular deeply involved in managing private equity funds and direct investments, first as founder and CEO of Swiss Life Private Equity Partners and from 2004 as independent advisor to family offices and institutional investors. David Salim holds a Master of Arts degree from the School of Economics of the University of St. Gallen (M.A. HSG). Dr. Guido Cornella, born 1969, Swiss citizen. Dr. Guido Cornella, joined GP Advisors Ltd, Zurich in July 2013. He has over 15 years experience as a strategy consultant and finance executive. Initially he worked at McKinsey & Co. in Zurich for four years and subsequently practiced as an independent strategy consultant with projects in private equity, banking, insurance, telecoms, media, logistics and pharmaceuticals in Europe, USA, Latin America and Asia. Additionally he served as director of finance and marketing for a start-up for two years. Prior to joining GP Advisors, Dr. Cornella (through Cornella Industries) was involved in developing the Company’s new strategy and supporting the balance sheet restructuring transaction. In 2015, Cornella Industries received no fees.

4. MANAGEMENT BOARD No Management Board Since 1 July 2013, the Board of Directors has discontinued the delegation to the Management Board of the day-to-day operations of the Company and has carried out these functions by itself. In light of this, the Company and GP Advisors Ltd, Zurich (formerly APEN Services GmbH) amended their agreement on

Dr. Cornella holds an engineering degree from the Swiss Federal Institute of Technology in Zurich (Dipl. Ing. ETH) and M. S. and Ph. D. degrees in Materials Science from Stanford University in California, USA. Mandates in other Entities As the Company has no Management Board, the Articles of Association do not contain any rules on the number of mandates the members of the Management Board may exercise as

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ANNUAL REPORT 2015  CORPORATE GOVERNANCE

member of the top governing or administrative body of entities which are required to register with the Swiss Commercial Register or a similar foreign register according to Article 12 para. 1 subpara. 1 VegüV.

5. COMPENSATIONS, SHAREHOLDINGS AND LOANS

6. SHAREHOLDERS’ PARTICIPATION RIGHTS Voting-Rights Restrictions and Representations Each registered share in the Company is entitled to one vote. Please see also Article 7 section 1 in the Articles of Association available on the Company website voting rights may be exercised only after a shareholder has been registered as shareholder with voting rights in the Company’s share register.

Content and Method of Determining the Compensations Performance-based Compensation and Share Ownership Plans The rules governing the principles of performance-based compensation and the grant of equity securities, conversion rights and option rights for compensation purposes according to Article 12 para. 2 subpara. 2 and 3 VegüV can be found in the Article 17a and 17b of the Articles of Association of the Company. The Articles of Association are available on the Company website. As the Company does not have a Management Board, the Articles of Association do not contain any corresponding rules on compensation of the Management. Credits and Loans As the Company does not grant any credits, loans and post-retirement benefits beyond occupational pensions to members of the Board of Directors, its Articles of Association do not contain any rule according to Article 12 para. 2 subpara. 1 VegüV. Shareholder Vote on Compensation The rules governing the shareholder vote on compensation according to Article 12 para. 2 subpara. 6 VegüV can be found in Article 17c of the Articles of Association. The Articles of Association are available on the Company website. Compensation Report For further information on compensation, please also refer to the compensation report on page 66 of this annual report.

Rules on participating in the General Meeting if different from Law No restrictions. Please see Article 7 section 2 in the Articles of Association available on the Company website. Statutory Quora The statutory quora comply with the applicable legal regulations. Please see Article 8 in the Articles of Association available on the Company website. Convocation of the Shareholders’ Meeting and Proposal for Agenda Items The rules for the convocation of the Shareholders’ Meeting comply with the applicable legal regulations. The convocation may also be requested by one or several shareholders representing together at least ten percent of the share capital. In accordance with the applicable legal regulations, one or several shareholders holding at least ten percent of the share capital or shares with an aggregate nominal value of CHF 1 000 000 are entitled to propose items for the agenda of the Shareholders’ Meeting. Please see also Articles 5 and 6 in the Articles of Association available on the Company website. Registration in the Share Register for Annual General Meeting (AGM) 2016 In 2016, the Annual General Meeting (AGM) is scheduled to be held on 19 May 2016; investors who wish to attend the Annual General Meeting (AGM) 2016 must be registered in the share register of the Company no later than 27 April 2016. Independent Proxy The Articles of Association of the Company do not contain any rules on the submission of directives to the independent proxy or the electronic participation in the Annual General Meeting (AGM).


CORPORATE GOVERNANCE  ANNUAL REPORT 2015

7. CHANGES OF CONTROL AND DEFENCE MEASURES

9. INFORMATION POLICY

Duty to make an Offer There is no duty to make an offer (opting-out; please see also Article 23 in the Articles of Association available on the Company website pursuant to Article 32 of the Federal Stock Exchange Act (SESTA).

The Company aims to offer the shareholders a high degree of transparency. In this respect the Company published during 2015 an annual report, a semi-annual report, two quarterly reports, and monthly factsheets.

Change of Control Clauses The Company has agreed to change of control clauses for the benefit of the Board Members with respect to Stock Appreciation Rights (SARs), in that vesting may be immediate in a change of control situation. Such benefits are also granted to Mr Salim and Dr. Cornella, executive officers of GP Advisors Ltd, Zurich, and to certain other non-executive employees of GP Advisors Ltd, Zurich.

8. AUDITORS Date of Assumption of the existing Auditing Mandate PricewaterhouseCoopers AG (PwC) is elected until the next Annual General Meeting which is scheduled to be held on 19 May 2016. Responsible Partner: Daniel Pajer (since 2012). Total of Audit Fees in 2015 TUSD 151 Additional Fees in 2015 TUSD 10 additional fees related to tax preparation and FATCA services. Supervisory and Control Instruments vis-à-vis the Auditors, Control Instruments Since there is no Audit Committee and no separate internal audit function, the Auditors’ report is presented to the whole Board of Directors as a part of the annual report. In addition, the responsible Auditor participates in the Annual General Meeting and is standing by for questions and detailed audit information.

In between the above described publications relevant information (including information subject to ad-hoc publicity according to section 53 of the SIX Swiss Exchange Listing Rules) is published in the form of press releases and available on the Company website.

63


COMPENSATION REPORT


66

ANNUAL REPORT 2015  COMPENSATION REPORT

COMPENSATION REPORT 2015

1

BOARD COMPENSATION

1.1

Member of the Board-Compensation from 1 January 2015 until 31 December 2015 (audited) Base compensation

Variable compensation

Other benefits

Total

100

13

113

Antonio Carlos Augusto Ribeiro Bonchristiano (Vice-Chairman and Member of the Compensation Committee)

50

7

57

David Justinus Emery (Member of the Compensation Committee)

85

11

96

Fersen Lamas Lambranho (Member of the Compensation Committee) 1)

50

7

57

David Pinkerton (Member of the Compensation Committee)

75

10

85

360

48

408

in TCHF

Board of Directors Eduardo Leemann (Chairman and Member of the Compensation Committee)

Alvaro Lopes da Silva Neto (Member of the Compensation Committee) 2) Total Board of Directors Note:

• “Base Compensation” comprises exclusively board meeting attendance fees. • Stock Appreciation Rights (SARs) constitute Variable Compensation and are reported under “Variable Compensation”. The amount reported corresponds to the value of the SARs allotted in the relevant business year. • “Other Benefits” means social security insurance contributions paid by the Company with respect to compensation of Board Members. 1) Board member since 26 February 2015. 2) Board member until 26 February 2015.

Company’s Board of Directors compensation for 2015 was paid in May and December 2015. 1.2

Member of the Board-Compensation from 1 January 2014 until 31 December 2014 (audited)

in TCHF

Base compensation

Variable compensation

Other benefits

Total

102

15

8

125 71

Board of Directors Eduardo Leemann (Chairman and Member of the Compensation Committee) Antonio Carlos Augusto Ribeiro Bonchristiano (Vice-Chairman and Member of the Compensation Committee)

52

15

4

Alvaro Lopes da Silva Neto (Member of the Compensation Committee)

52

15

4

70

David Justinus Emery (Member of the Compensation Committee)

87

15

7

109

David Pinkerton (Member of the Compensation Committee) Total Board of Directors

77

15

6

98

370

75

28

472

Note: • “Base Compensation” comprises exclusively board meeting attendance fees. • Stock Appreciation Rights (SARs) constitute Variable Compensation and are reported under “Variable Compensation”. The amount reported corresponds to the value of the SARs allotted in the relevant business year. • “Other Benefits” means social security insurance contributions paid by the Company with respect to compensation of Board Members.

Company’s Board of Directors compensation for 2014 was paid in December 2014. 2

MANAGEMENT COMPENSATION AS OF 31 DECEMBER 2015 AND 31 DECEMBER 2014

In the absence of a Management Board, the Company has not paid remuneration to a Management Board in 2015 and 2014.

3

CREDITS OR LOANS AS OF 31 DECEMBER 2015 AND 31 DECEMBER 2014

No credits or loans were granted to any current or former members of executive bodies or related parties nor are any credits or loans outstanding. The Company did not pay any non-market standard compensation, directly or indirectly, to any current or former members of the executive bodies or related parties.


COMPENSATION REPORT  ANNUAL REPORT 2015

REPORT OF THE STATUTORY AUDITOR COMPENSATION REPORT 2015

We have audited the remuneration report of Spice Private Equity Ltd for the year ended 31 December 2015. The audit was limited to the information according to articles 14–16 of the Ordinance against Excessive Compensation in Stock Exchange Listed Companies (Ordinance) contained in the table labeled “audited” on page 66 of the remuneration report.

Opinion In our opinion, the remuneration report of Spice Private Equity Ltd. for the year ended 31 December 2015 complies with Swiss law and articles 14–16 of the Ordinance.

PricewaterhouseCoopers AG Board of Directors’ responsibility The Board of Directors is responsible for the preparation and overall fair presentation of the remuneration report in accordance with Swiss law and the Ordinance against Excessive Compensation in Stock Exchange Listed Companies (Ordinance). The Board of Directors is also responsible for designing the remuneration system and defining individual remuneration packages. Auditor’s responsibility Our responsibility is to express an opinion on the accompanying remuneration report. We conducted our audit in accordance with Swiss Auditing Standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the remuneration report complies with Swiss law and articles 14–16 of the Ordinance. An audit involves performing procedures to obtain audit evidence on the disclosures made in the remuneration report with regard to compensation, loans and credits in accordance with articles 14–16 of the Ordinance. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatements in the remuneration report, whether due to fraud or error. This audit also includes evaluating the reasonableness of the methods applied to value components of remuneration, as well as assessing the overall presentation of the remuneration report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Daniel Pajer Audit expert Auditor in charge

Zurich, 17 February 2016

Martin Gubler Audit expert

67


FINANCIAL STATEMENTS (SWISS LAW) – SPICE PRIVATE EQUITY LTD


70

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (SWISS LAW) – SPICE PRIVATE EQUITY LTD

REPORTING AS OF 31 DECEMBER 2015 AND AS OF 31 DECEMBER 2014 IN TCHF Note

31.12.2015

31.12.2014

Cash and cash equivalents

37 435

46 355

Receivables

37 221

37 205

BALANCE SHEET Assets Current assets

Prepayments Total current assets

197

167

74 853

83 727

74 184

111 405

Non-current assets Long-term receivables Participations

8

72 022

30 810

Total non-current assets

146 206

142 216

Total assets

221 059

225 943

Liabilities and Shareholders’ Equity Current liabilities Payables Accrued charges Total liabilities

20

73

1 801

6 064

1 821

6 1 37

Shareholders’ Equity Share capital Reserve from capital contributions Accumulated deficit brought forward Net profit/(loss) for the year Treasury shares against reserve from capital contributions

9

53 637

53 637

384 476

384 476

(218 126)

(215 785)

(594)

(2 340)

(156)

(181)

Total Shareholders’ Equity

219 238

219 806

Total liabilities and Shareholders’ Equity

221 059

225 943


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FINANCIAL STATEMENTS (SWISS LAW) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

REPORTING 1 JANUARY TO 31 DECEMBER 2015 AND 1 JANUARY TO 31 DECEMBER 2014 IN TCHF Note

1.1.2015 – 31.12.2015

1.1.2014– 31.12.2014

16 038

73

4 544

INCOME STATEMENT Operating Income Dividend income from non-current assets

5

Net gain/(loss) on foreign currency exchange Net realized gain/(loss) on sale of loan

56

Net realized FX gain/(loss) on sale of participation

22 256

Recovery/(impairment) of participation

5

Net gain/(loss) on sale of participation Total operating income

1 500

(2 525)

(34 091)

1 573

6 278

Operating Expenses Administration fees

(99)

(100)

(990)

(8 511)

(1 089)

(8 611)

(807)

(323)

(2 333)

Currency translation differences gain/(loss)

(265)

Profit/(loss) before tax

(588)

(2 333)

(6)

(7)

Net profit/(loss) after tax

(594)

(2 340)

Net profit/(loss) for the year

(594)

(2 340)

Other operating expenses Total operating expenses Financial expense Profit/(loss) from operations

Tax expenses

17


72

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (SWISS LAW) – SPICE PRIVATE EQUITY LTD

NOTES TO THE FINANCIAL STATEMENTS

NOTE 1

COMPANY INFORMATION

Spice Private Equity Ltd, Zug (“the Company”) is a Swiss stock corporation established under the relevant provisions of the Swiss Code of Obligations (“CO”) and domiciled in Zug.

The Company’s financial statements were authorized for issue on 16 February 2016 by the Board of Directors. The financial statements are subject to approval at the Annual General Meeting of shareholders on 20 May 2016.

NOTE 2 MAJOR SHAREHOLDERS Major Shareholders The following major shareholders held shares and voting rights of 3 % and more as of 31 December 2015 (number of shares according to the public disclosures of shareholdings

at SIX Swiss Exchange; voting rights recalculated based on current share capital):

GP Investments / Newbury Capital 1)

Number of Shares 2015

Participation in % 2015

Number of Shares 2014

Participation in % 2014

2 419 208

45.10 %

2 419 208

45.10 %

Drawbridge Special Opportunities Fund LP (Fortress)

717 266

13.37 %

717 266

13.37 %

OAM European Value Fund

270 149

5.04 %

270 149

5.04 %

Wellington Management Company, LLP

211 128

3.94 %

210 936

3.93 %

167 000

3.11 %

167 000

3.1 1  %

AXA Life

The shares are held by two entities, namely GP Swiss Ltd (Switzerland) (formerly GP Secondaries Investment Company (Switzerland) Ltd), and Newbury Holdings A Ltd. (Cayman Islands). These two entities are connected through a shareholders’ agreement.

1)

NOTE 3 METHOD OF FINANCIAL ACCOUNTING

NOTE 4 FOREIGN EXCHANGE RATES

These financial statements have been prepared in accordance with the provisions of commercial accounting as set out in the Swiss Code of Obligations (Art. 957 to 963b CO).

The following exchange rates have been applied to translate the foreign currencies of significance for the Company:

The company prepares financial statements in accordance with a recognized financial reporting standard (IFRS), the additional information in the notes to the financial statements, the cash flow statement and the management report are waived (Art. 961d para 1). To better reflect the performance of the investment activities of the Company’s participation the Board of Directors has resolved to change the functional currency from CHF to USD as of 1 January 2015. The quoting currency in which shares are traded at the SIX Swiss Exchange was also changed from CHF to USD (20 May 2015). Based on Board of Directors decision, the Company continues to present the financial report in CHF, in line with provisions of the Swiss Code of Obligations.

Unit

2015 CHF

2014 CHF

Swiss Franc

1 USD

0.99250

0.99365

Euro

1 EUR

0.92386

1.20240

Swiss Franc

1 USD

0.96240

0.91542

Euro

1 EUR

0.93610

1.21611

Year-end exchange rates

Average annual exchange rates

NOTE 5 EXPLANATION OF BALANCE SHEET AND PROFIT AND LOSS STATEMENT POSITIONS Spice Private Equity Ltd generated operating income of CHF 1.6 million (2014: CHF 6.3 million), operating expenses of CHF 1.1 million (2014: CHF 8.6 million), financial expenses of CHF 0.8 million (2014: nil) and a currency translation difference loss of CHF 0.3 million (2014: nil) resulting in a net operating loss before tax of CHF 0.6 million (2014: CHF 2.3 million loss). After tax expenses of CHF 0.0 million (2014: CHF 0.0 million) the net loss of the year stood at CHF 0.6 million (2014: net loss of CHF 2.3 million). The 2015 other operating expense includes a credit of CHF 1.1 million due to release of provision built for


FINANCIAL STATEMENTS (SWISS LAW) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

certain transaction costs related to the restructuring transaction as of 31 December 2014, reducing the other operating expense from CHF 2.1 million to CHF 1.0 million. The emerging-market investments within the participation performed well. The net equity of the participation increased by CHF 41.2 million to CHF 72.0 million. The valuation of the participation is based on the lower of the capital contributed to the subsidiary (cost) and the reported net equity of Spice Private Equity (Bermuda) Ltd. Dividend income is recognized when the Company’s right to receive payment is established. The 2015 reported operating income and resulting net operating profit figures include the recovery of CHF 1.5 million (2014: impairment of CHF 2.5 million) of the participation (Spice Private Equity (Bermuda) Ltd)). After the receipt of the first deferred payment of CHF 36.0 million (USD 37.4 million) at the end of September 2015 stemming from the sale of the “Legacy Portfolio”, the outstanding receivables from Strategic Partners amounted to CHF 111.3 million, in line with the deferred payment schedule. Cash held across the subsidiary and the holding entity stood at CHF 49.3 million as of 31 December 2015, and unfunded commitments amounted to CHF 28.9 million. The revolving credit facility of CHF 74.7 million (USD 75 million) is in place to potentially accelerate the investment pace but not to create leverage.

NOTE 9 BALANCES AND TRANSACTIONS WITH TREASURY SHARES Per year-end 2015 the Company held 6 395 treasury shares (2014: 7 917). As shown in the table below during 2015 the Company purchased 34 797 shares (2014: 17 905) at market conditions (average price of CHF 23.26) and sold 36 319 (2014: 9 988) at market conditions (average price of CHF 22.97). Transactions with treasury shares 2015

No of shares

Amount in CHF

7 917

181 057

22.87

Purchase

34 797

809 235

23.26

Sold

36 319

834 250

22.97

6 395

156 042

24.40

As of January 1

As of December 31

Average price

Spice Private Equity (Bermuda) Ltd does not have any holdings in Spice Private Equity Ltd.

NOTE 10 LEASING The Company has no leasing obligations.

NOTE 11 OBLIGATIONS TOWARDS PENSION FUNDS The Company does not have any obligations towards pension funds.

NOTE 6 TOTAL AMOUNT OF REPLACEMENT RESERVES USED AND REALIZED HIDDEN RESERVES NOTE 12 SECURITIES, RESERVATION OF TITLE In the year 2015, no replacement reserves used and no hidden reserves were realized.

NOTE 7 NUMBER OF FULL-TIME POSITIONS

The Company has not granted any securities for third parties. The Company has not used own assets to secure liabilities, except for the pledge to secure the loan facility (Note 17) and none of its assets are subject to a reservation of title.

The Company does not have any employees (2014: nil). NOTE 13 CONTINGENT LIABILITIES NOTE 8 PARTICIPATIONS 2015 Company

Domicile

Spice Private Equity Hamilton, (Bermuda) Ltd Bermuda

2014 Company

Domicile

Spice Private Equity Hamilton, (Bermuda) Ltd Bermuda

Function

% capital and votes held Currency

Investment Company 100

Function

USD

% capital and votes held Currency

Investment Company 100

USD

The Company has no contingent liabilities. Refer to Note 5 regarding unfunded commitments entered by the subsidiary. Share capital

1 USD

Share capital

1 USD

73


74

ANNUAL REPORT 2015  FINANCIAL STATEMENTS (SWISS LAW) – SPICE PRIVATE EQUITY LTD

NOTE 14

SHAREHOLDINGS, CONVERSION AND OPTION RIGHTS

Shareholdings, Conversion and Option Rights

Name

Function

Shares 2015

SARs 1) 2015

Shares 2014

SARs 1) 2014

Board of Directors Eduardo Leemann

Chairman

Antonio Carlos Augusto Ribeiro Bonchristiano 2) Vice-Chairman David Justinus Emery Fersen Lamas Lambranho

Member

12 000

200

16 000

8 000

1 702 482

8 000

8 000

8 000

1 702 482

Alvaro Lopes da Silva Neto

Member, until 26 February 2015

8 000

8 000

David Pinkerton

Member

12 000

16 000

2)

Member, since 26 February 2015

200 1 702 482

SARs are granted free of charge. Each SAR entitles the holder to receive in cash the difference between the strike price and the market price of one share of the Company at the exercise date. A third of the SARs are each exercisable after a vesting period of one, two and three years. The SARs expire after five years. In case of a termination of the working contract during the vesting period, the SARs are cancelled. The Company has agreed to change of control clauses for the beneficiaries with respect to SARs, in that vesting may be immediate in a change of control situation (this policy has been applied to all SARs issued in 2011 and 2012). 2) Members Bonchristiano and Lambranho are parties to a shareholders agreement based on which the reported shares are held. The share number disclosed for each of the two persons corresponds to the total number of shares held by the entity covered by the shareholders agreement. For further details see disclosure of significant shareholdings as published by SIX Swiss Exchange Regulation. 1)

No receivables and liabilities vis-à-vis direct or indirect participants and management bodies and vis-à-vis undertakings in which there is a participation as of 31 December 2015 (31 December 2014: nil).

NOTE 15 SPECIAL EVENTS REGARDING THE PROFIT AND LOSS STATEMENT There have not been any extraordinary or single events nor have there been any events relating to other periods that need further explanation of items in the profit and loss statement.

NOTE 16 SUBSEQUENT EVENTS Since the balance sheet date of 31 December 2015, there have been no material events that could impair the integrity of the information presented in the financial statements.

The credit facility, if and when drawn, is secured by a pledge on the Company’s outstanding receivables from Strategic Partners VI Acquisitions G, L.P. (31 December 2015: CHF 111.3 million). Final maturity date for the credit facility is 29 December 2017 and may be extended to 30 June 2018. The credit line reduces from the original amount of USD 75 million to USD 37.4 million on 31 March 2017 and to zero on final maturity. The interest rate is LIBOR +3.0 % p. a. and the commitment fee for the undrawn amount 1.25 % p. a. As of 31 December 2015, the credit line has been drawn down for CHF nil million (31 December 2014: nil). Finance costs of TCHF 807 (31 December 2014: nil) were accrued as of 31 December 2015 and charged against financial expense.

NOTE 17 LONG-TERM DEBT NOTE 18 AUDITOR’S FEES The Company obtained a CHF 74.7 million (USD 75 million) loan facility from Falcon Private Bank Ltd., Zurich and VP Bank Ltd., Vaduz on 11 May 2015. Should attractive investment opportunities arise, the Company would be able to anticipate a portion of the outstanding cash receivables from its sale of the “Legacy Portfolio” at the end of 2014 and thus accelerate its investment pace.

The Company during 2015 incurred the following fees to its auditors: Service

Audit Fees related to tax preparation and FATCA service

Fee (TCHF)

146 10


FINANCIAL STATEMENTS (SWISS LAW) – SPICE PRIVATE EQUITY LTD  ANNUAL REPORT 2015

REPORT OF THE STATUTORY AUDITOR ON THE FINANCIAL STATEMENTS (SWISS LAW) – SPICE PRIVATE EQUITY LTD

As statutory auditor, we have audited the financial statements of Spice Private Equity Ltd, which comprise the balance sheet, income statement and notes (pages 70 to 74), for the year ended 31 December 2015.

Opinion In our opinion, the financial statements for the year ended 31 December 2015 comply with Swiss law and the company’s articles of incorporation.

Board of Directors’ responsibility The Board of Directors is responsible for the preparation of the financial statements in accordance with the requirements of Swiss law and the company’s articles of incorporation. This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or error. The Board of Directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.

Report on other legal requirements We confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and independence (article 728 CO and article 11 AOA) and that there are no circumstances incompatible with our independence.

Auditor’s responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Swiss law and Swiss Auditing Standards. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

We recommend that the financial statements submitted to you be approved.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control system. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists which has been designed for the preparation of financial statements according to the instructions of the Board of Directors.

PricewaterhouseCoopers AG Daniel Pajer Audit expert Auditor in charge

Zurich, 17 February 2016

Martin Gubler Audit expert

75


76 2

ANNUAL REPORT 2015  SPICE PRIVATE EQUITY EMERGING MARKETS SPICE PRIVATE EQUITY

ADDRESSES AND CONTACTS ORGANIZATION

REGISTERED OFFICES

Board of Directors Eduardo Leemann, Chairman Antonio Bonchristiano, Vice Chairman David Emery, Member Fersen Lambranho, Member David Pinkerton, Member

Spice Private Equity Ltd Industriestrasse 13c CH-6302 Zug Phone +41 41 710 70 60 Fax +41 41 710 70 64 info@spice-private-equity.com

Investment Committee Antonio Bonchristiano Fersen Lambranho Alvaro Lopes David Salim

Spice Private Equity (Bermuda) Ltd Clarendon House 2, Church Street Hamilton, HM 11 Bermuda

Auditors PricewaterhouseCoopers AG Birchstrasse 160 CH-8050 Zürich

www.spice-private-equity.com

INVESTOR RELATIONS

KEY INFORMATION Swiss Security Number: 915.331 ISIN: CH0009153310 Ticker symbol: SPCE Reuters: SPCE.BN Bloomberg: SPCE:SW

Dr. Guido Cornella Investor & Media Relations GP Advisors Ltd Löwenstrasse 29 CH-8001 Zurich Phone +41 44 578 50 50 investor.relations@spice-private-equity.com


IMPRESSUM Publisher Spice Private Equity Ltd, Zug Copy and editorial management GP Advisors Ltd, Zurich and HDK Haus der Kommunikation AG, Zollikon Concept and design HDK Haus der Kommunikation AG, Zollikon Photography Portraits: Katharina Wernli Photography, Zurich; Images: Getty Images Printed Climate neutral, Neidhart + Schรถn AG, Zurich Paper Munken Polar Highwhite


THE BRIDGE TO EMERGING MARKETS. www.spice-private-equity.com

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