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Vito gamberale presenting F2i

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Vito Gamberale - F2i

Vito Gamberale - F2i

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  • 1. Vito Gamberale – Presenting F2iPresenting F2iPiacenza (Italy), April 29, 2011
  • 2. 2Vito Gamberale – Presenting F2iTable of contents1. The Fund and the fund management company Pg. 32. Fund investors Pg. 113. Development of the Fund Pg. 174. Accomplished investments Pg. 205. F2i as a co-shareholder of public entities – Advantages Pg. 236. F2i: an operational example Pg. 25
  • 3. 3Vito Gamberale – Presenting F2i1. The Fund and the fund management company
  • 4. 4Vito Gamberale – Presenting F2i Thanks to a fundraising of 1,852 mil €, F2i is the biggest fund operating in Italyand counts among the biggest country infrastructure funds worldwide. F2i was created as a private, yet institutional tool by high standing sponsors, whocontributed to the establishment of the Fund’s solid reputation: the government, through CDP major Italian banks (Unicredit, Intesa SanPaolo) an important international bank (Merrill Lynch – BoA) the networks of former banking foundations and private welfare funds life insurance companies and pension funds. Following its mission and the institutional nature of its investors, F2i aims to buildlong-term participations with an industrial understanding. The F2i management fees are among the lowest on the market: 0.6% – 0.9% vs.2–2.5% on average.The Fund and the fund management company
  • 5. 5Vito Gamberale – Presenting F2i Funds are managed by a «fund management company» (Italian: SGR, societàdi gestione del risparmio), whose legal personality and assets are separated fromthose of the fund itself. The members of F2i SGR are called sponsors. The F2i Fund is managed by F2i SGR, a joint-stock company. SGR’s role is toselect assets to invest the money raised by the Fund. Its objective is to give theinvested assets back to the investors with a specific return.F2i Fund InvestorsSponsors − 938 mil €(50.65%)Limited Partners − 906 mil €(48.92%)SGR Sponsors & Managers − 8 mil €(0.43%)SGR1,852 mil €ManagementManagerInvestmentsAssetsAssets + returnsSGR shareholders (Sponsors)The Fund and the fund management company
  • 6. 6Vito Gamberale – Presenting F2iF2i SGR F2i Fund Has exclusive jurisdiction on determining the investment decisions andsubmitting them to the Board of Directors. 9 members: 4 members of the Investment Team (Chief Executive, Senior Partnersand Partners) 5 infrastructure professionals appointed by the sponsors.Investment Board Final approval of the investement operations proposed by theInvestment Committee. 11 members: Chief Executive (Vito Gamberale) 5 representatives of the main sponsors 5 representatives of the institutional investors (Italian bankfoundations and welfare funds).Board of DirectorsAssembly of Participants Approves the following: amendments of the Fund regulations replacement of the SGR IPO of the Fund.Advisory Committee Provides binding opinions to the SGR on key topics: exceeding investment limits approval of key manager replacement. Appoints the Conflict Committee. At least 7 members: each Core Investor (investors with minimum subscription of 60 mil €of the Fund) can appoint one member.Conflict Committee Provides binding recommendations on the correct applications ofprocedures to manage conflicts of interest. 3 members appointed by the Advisory Committee selected among thecommittee members.The Fund and the fund management companyThe Fund’s company «governance»
  • 7. 7Vito Gamberale – Presenting F2iF2i Board of DirectorsEttore GottiTedeschi President (among his assignments, President of the Institute for the Works of Religion, IOR [Italian:Istituto per le Opere di Religione]; board member of the CDP and President of Banco di Santander Italy).In office since April 2009.Vito Gamberale  Chief ExecutiveAntonioBranca Board Member (Secretary General of the Savings Bank Foundation in Forlì, Italy)RiccardoConti Board Member (for 20 year Provincial Councillor, then Regional Councillor in Tuscany with powers overinfrastructures and logistics)Giancarlo Giorgi  Board Member (Managing Director of Inarcassa)DavideMereghetti Board Member (Head of Multinational Direction / Large Corporate at Unicredit Corporate & InvestmentBanking)AndreaMontanino Board Member (General Director of the Treasury Department – Italian Ministry of Economy andFinance)Paolo Morerio  Board Member (Textile Entrepreneur and President of the Vismara Foundation)Maurizio Pagani  Board Member (Head of the Infrastructure and Project Finance Department at Banca Intesa,Infrastructures and Development)MaurizioTamagnini Board Member (Head of Merrill Lynch Investment Banking Italy, Bank of America Group)Fiorenzo Tasso  Board Member (40 years of experience at ENEA, the Italian Agency for new Technologies, Energy andSustainable Economic Development [Ente per le Nuove Tecnologie, lEnergia e lAmbiente] and Memberof various Boards of Directors)The Fund and the fund management companyF2i SGR: Board of Directors
  • 8. 8Vito Gamberale – Presenting F2iThe Fund and the fund management companyInvestment CommitteeMembers of the Investment CommitteeVito Gamberale  F2i Chief ExecutiveCarlo Michelini  F2i Senior Partner and Chief Investment OfficerMauro Maia  F2i Senior PartnerCorrado Santini  F2i Senior PartnerF2i Manager  Manager of the Investment Team, Head of ProjectCesare BuzziFerraris Head of the Principal Investment Activity at Unicredit in Italy; former Head of the Italian team ofCorporate Finance and M&ABarnabaRavanne Managing Director, Partner and Member of the Merrill Lynch Global Private Equity InvestmentCommitte. Joined ML Investment Banking in 1997, adding more than 10 years of experience in PEAnna Molinotti  Head of the CDP Shareholdings (succceeding to Matteo Del Fante, upon resignation)StefanoLodigiani Head of the Credit Department at Banca Intesa Infrastructures and DevelopmentAngeloRampinelli Rota President of Gas Plus, former President of ASM Brescia, Councillor for the Brescia Municipality andCouncillor for the Province of Brescia
  • 9. 9Vito Gamberale – Presenting F2iThe Fund and the fund management companyAdvisory Committee and Conflict Committee of F2i FundF2i Fund Advisory Committee1. Carlo Dolci President, effective member since January 16, 2008 (appointed as member of the Advisory Boardby the Italian National Welfare and Assistance Fund for Lawyers)2. Raffaele Bartoli Effective member since January 15, 2008 (Head of Development at Generali Investments Lux.)3. Bonaventura Canino Effective member since January 17, 2008 (Senior Banker at Calyon, head Project Finance)4. Maria Bianca Farina Effective member since December 12, 2008 (Chief Executive at Poste Vita)5. Roberto Ferrario Effective member since January 9, 2009 (Director of BPM Corporate Finance Services)6. Francesco Mannoni Effective member since January 16, 2008 (Board Member of the Banco di Sardegna Foundation);Also President of F2i Conflict Committee7. Jacopo Mazzei Effective member since March 19, 2008 (Councillor for SB Florence)8. Vincenzo Miceli Effective member since January 17, 2008 (President of ENPACL);Also Member of F2i Conflict Committee9. Mario Schiavon Effective member since September 19, 2008 (President of ENPAPI);Also Member of F2i Conflict Committee10. Bruno Boco Effective member since October 6, 2010 (President of the Enasarco Foundation)11. Claudio Albertini Effective member since October 6, 2010Members of the Conflict Committee
  • 10. 10Vito Gamberale – Presenting F2i2. Fund investors
  • 11. 11Vito Gamberale – Presenting F2iFund investorsInvestor categoriesCDPSGR managersthe 2 biggestItalian banksOtherfoundations1 internationalbankLife insurancesWelfare and pensionfundsLife insurancecompaniesBanksOther banksItalian assetsInternationalassets7 of the majorfoundations2 welfare fundsSGR shareholders(Sponsors)(Limited Partners)F2i –InfrastructureItalian Fund(Managers)
  • 12. 12Vito Gamberale – Presenting F2iNote: F2i SGR representsan «atypical» example ofPrivate Equity and non-banking FMCs, as itsmanagement is not ashareholder of the companybut invests directly in theFund.Fund investorsInvestor categoriesQuote AmountSGR members14 Share A - Sponsors (S) 938 € 938,000,000.00 50.65% of 1,050,000,000.00 € from the budgetMarket10 Share B – Core investors 610 € 610,000,000.00 32.94% Average success rate:30 Share B – Other investors 296 € 296,000,000.00 15.98%40 Share B - Limited Partners (LP) 906 € 906,000,000.00 48.92% of 950,000,000.00 € from the BudgetSponsors and management1 Sponsors/SGR 103 € 5,150,000.00 0.28%1 Company of the managers 57 € 2,850,000.00 0.15%2Share C - SGR/sponsors& managers 160 € 8,000,000.00 0.43%56 F2i Fund capital and reserves 2,004 € 1,852,000,000.00 100%Average LP + S investment:Average LP investment:(Success Rate = 89.33%, followingLB failure and partial takeoverof CIPAG and Inarcassa)€ 34,148,148.15€ 22,650,000.00%Fund92.20%(Success rate = 95.37%)n.Category
  • 13. 13Vito Gamberale – Presenting F2iFund investorsF2i SGR shareholders (sponsors) Attend the SGR Board of Directors meetings Appoint experts of the Fund Investment Committee amongits membersPowers of thesponsors(€ mil) (% Fund)1 CDP 15.99% € 150.00 8.10%2 Unicredit 15.99% € 150.00 8.10%3 Biis 15.99% € 150.00 8.10%4 Merrill Lynch (BoA) 15.99% € 150.00 8.10%5 Cariplo Foundation 6.40% € 60.00 3.24%6 MPS Foundation 6.40% € 60.00 3.24%7 SB Foundation Turin 6.40% € 60.00 3.24%8 Surveyors Fund 6.40% € 60.00 3.24%9 Inarcassa 4.05% € 38.00 2,05%10 SB Foundation Bologna 1.60% € 15.00 0.81%11 SB Foundation Padova e Rovigo 1.60% € 15.00 0.81%12 SB Foundation Cuneo 1.60% € 15.00 0.81%13 SB Foundation Forlì 1.60% € 15.00 0.81%Total 100.0% € 938.00 50.6%F2i SGR shareholdersShare %SGRF2i Fund share
  • 14. 14Vito Gamberale – Presenting F2i The Limited Partners that invested in F2i include some of the majorinstitutional bodies from the following categories: «Limited partners» are non-promoting partners, who are not SGR members.«Limited» indicates that the powers of such investors are limited compared tothose of the sponsors.Fund investorsLimited PartnersOf which 2 are also sponsorsOf which 2 are not ItalianOf which 1 is not ItalianLimited Partners Subscribedamount% on the Fund N. ofinvestorsBanks 143 mil € 7.72% 4Welfare funds 389 mil € 21.00% 13Foundations 199 mil € 10.75% 19Insurance companies 175 mil € 9.45% 4Total 906 mil € 48.92% 40
  • 15. 15Vito Gamberale – Presenting F2i The Limited Partners are:Fund investorsLimited Partners 4 Banks (2 Italian and 2 international) 13 Italian welfare funds, representing the different professional categories ofworkers 19 Italian bank foundations (of the 84 members of ACRI) 4 major insurance companies (3 Italian, 1 international)
  • 16. 16Vito Gamberale – Presenting F2i To further guarantee transparency and sobriety, a fund share of 8 mil € iscommitted to co-investment by the SGR managers and sponsors: managers are not SGR members, therefore they don’t share the SGRgains, that are assigned to SGR members (i.e. the sponsors) managers take their own share of risk in co-investing in singleinvestments together with the investors.Fund investorsSponsors & managers
  • 17. 17Vito Gamberale – Presenting F2i3. Development of the Fund
  • 18. 18Vito Gamberale – Presenting F2i1. According to the Fund regulations, investments could be only be initiated after the minimumexpected asset was achieved (= 1.5 bil €), which F2i achieved on December 19, 2007 (First Closing).2. In 2008 F2i could start investments, proceeded with particular caution however to avoid hastyoperations in an environment of: a) great uncertainty; b) progressive worsening of the global crisis;c) still elevated prices; d) ongoing commitment of the management team in the fundraising.20142013 2015Fund IPOInvestment period extension2010 2011 20122007 2008 2009Project /AuthorizationFund Raising Investment periodManagementand disposalTodayAn asset of 1,852 bil € implies an average yearlyinvestment of 463 mil €An asset of 1,852 bil € implies an average yearly investment of 309 mil €Development of the FundInitial programme
  • 19. 19Vito Gamberale – Presenting F2i~ 977 milFirstClosing offundraising, start ofinvestmentsDevelopment of the FundFinal timeline• After 26 months out of 48/72 of the Investment Period (54/36%)• Committed 977 mil € out of 1,852 mil € raised (53%)• Delivered 568 mil € out of 1,852 mil € of the capital committed to date (31%)Gen Feb Mar Apr Mag Giu Lug Ago Set Ott Nov Dic Gen Feb Mar Apr Mag Giu Lug Ago Set Ott Nov Dic2008 20092013 2015Fund IPOInvestment period extension2010 2011 2012 20142007 2008 2009Project /AuthorizationFund Raising Investment period20142013 2015Fund IPOInvestment period extension2010 2011 20122007 2008 2009Project /AuthorizationFund Raising Investment periodManagementand disposalTodayManagementand disposal3thinvest.53.5 mil €Today6thinvest.294.9 mil €First Closing€ 1,55 mldFinal Closing€ 1,852 mldFirstdividendPlannedActualFirstdividend1thinvestment79.4 mil €2thinvest.35.2 mil €5thinvest.59.7 mil €4thinvest.50.1 mil €7thinvest.237.5 mil €Gen Feb Mar Apr Mag Giu Lug Ago Set Ott Nov Dic2008Gen Feb Mar Apr Mag Giu Lug Ago Set Ott Nov Dic2009Gen Feb Mar Apr Mag Giu Lug Ago Set Ott Nov Dic20108thinvest.92.9 mil €9thinvest.742 mil €President GottiTedeschi takesofficeJan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
  • 20. 20Vito Gamberale – Presenting F2i4. Accomplished investments
  • 21. 21Vito Gamberale – Presenting F2i To date, the Fund has already committed 977 mil € (53% of the raised funds) in9 industrial activities, creating a structured group in the process:Accomplished investmentsCommittedGASRENEWABLESTRANSPORTATIONWATERAIRPORTS404.3 mil € (41.4%)237.5 mil € (24.3%)129.5 mil € (13.2%)113.2 mil € (11.6%)92.9 mil € (9.5%)75% 80%75% 100% 100.0%49%100% 40.0%15.7%100%49.8%100% 22.7%26%100% 100% 70.0%F2iReti ItaliaENELRete GasENELStoccaggiAlerionCleanPowerF2iRenewablesEONRete GasF2i ReteIdrica ItalianaMediterraneadelle AcqueF2iReti Italia 2F2i5 networksGESACF2i airportsF2i SGRCampaniaregional airportnetworkHFVF2iLogisticsInterportoRivalta ScriviaInfracis
  • 22. 22Vito Gamberale – Presenting F2i F2i acts as a «public company»: each project develops with the objective tocreate an industry within a specific sector and foster cooperation amongsubsidiaries:Accomplished investmentsGASObjective: to represent the first independent manager of gas distributionnetworks and act as an aggregating entity in a currently strengthening sector.Objective: to contribute to Italy’s energy reliability and to start removing theStogit (ENI) monopoly, as urged by the AEEG and the anti-trust body.RENEWABLESObjective: to initiate two strong independent operators in both crucial segments(eolic and fotovoltaic), benefiting from the supporting actions of differentgovernments regarding renewable energy.TRANSPORTATIONObjective: to contribute to intermodal growth through one of the few playersactually acting as an industrial entity (not just real estate).Objective: to access the closed sector of highways as reference stakeholders forcompanies with extremey fragmented public shareholders.WATERObjective: to create a «national champion» in a crucial sector for Italy, whichrequires great investments to modernise the existing plants.AIRPORTSObjective: to create an aggregation focus in a strongly fragmented, mainlypublicly managed sector.ENEL Rete GasE.On ReteENELStoccaggiAlerionHFVInterportoRivalta ScriviaInfracisMediterraneadelle AcqueGESACNaples
  • 23. 23Vito Gamberale – Presenting F2i5. F2i as a co-shareholder of public entities – Advantages
  • 24. 24Vito Gamberale – Presenting F2i participate in the aquisition of brownfield assets also sold by public bodies, to supportits own development. As an important innovation, selling institutional parties are oftengranted an earn-out, a protection against future valorisations above specific limits involve both national and local financial systems in management companies, as realinternational public companies ensure an industrial management, aiming for effectiveness and managementdevelopment of the companies. To be able to actively take action on management, F2iaims to obtain majority stakes in the subsidiaries foster aggregation processes in sectors characterised by great fragmentation and highnational and European development potential ensure management enhancement of the subsidiaries by involving the management incorporate development and personal improvement projects.F2i as a co-shareholder of public entities – Advantages The institutional characteristic of F2i guarantees a stable long-lastingpartnership with no financial speculations, thus making the fund the idealpartner for public bodies. Indeed, F2i can:
  • 25. 25Vito Gamberale – Presenting F2i6. F2i: an operational example
  • 26. 26Vito Gamberale – Presenting F2iF2i operational exampleGas: F2i Reti ItaliaStorageNationaltransportationWholesaleDistributionRetailImport(Gas pipeline/ GNL)ProductionFocusF2i Reti Italia• Enel Rete Gas• E.On ReteF2i Reti Italia: plain distributor andonly independent group within the distribution.
  • 27. 27Vito Gamberale – Presenting F2iSource: adapted by F2i Reti Italia from the latest available AEEG dataF2i operational exampleGas: positioningVolumes(ML m3)Hera A2A G6 Rete GasIrenNetwork(Km)EniCustomers(/1,000)Enel Rete Gas+ E.On Rete6.5%29% 14.0% 6.5% 6.1% 4.6%9751,2331,1901,0972,7347,10033% 12.6% 5.0% 5.5% 5.6% 4.5%14,7457,6228,72913,25240,43160,0009,7003.5722,184 2,179 2,0481,5331,1064,6782,132602Hera A2AIrenEniHera A2AIrenEni31,3009,131G6 Rete GasG6 Rete Gas5.4% 3.6% 3.1% 6.0%16.5%24%Enel Rete Gas+ E.On ReteEnel Rete Gas+ E.On Rete
  • 28. 28Vito Gamberale – Presenting F2iF2i operational exampleGas: economic resultsEBITDA(1)Proceeds(1)2010 B2011453470241 252EBITDAmargin53% 54%+4%+5%F2i Reti Italia Group(1) Pro-forma data
  • 29. 29Vito Gamberale – Presenting F2iF2i operational exampleGas: investmentsGrowthOthers70962427636892010 B2011108Quality andsafetyF2i Reti Italia Group (mil €)168Benchmark (€/customer)~63~47F2iReti Italia GroupOther operators• Physiologicalgrowth: 51• Tenders: 28• Grantrequirements: 17• Regulations andquality: 15• Networkmodernisation: 12Investments agreedwith previous manager• Remote meterreading: 36Transparency• Others: 9
  • 30. 30Vito Gamberale – Presenting F2iF2i operational exampleGas: network inspection and emergency servicesInspected network (%)78%77%63%57%54%41%36%29%Enel gas networkHeraA2AIrenG6 Rete GasEni (Italgas)E.On ReteToscana EnergiaAverage inItaly: 55%Average real time for emergencysupport (minutes)Source: AEEG60~35AEEGrequirementEnel Rete GasYear: 2010
  • 31. 31Vito Gamberale – Presenting F2iF2i operational exampleGas: technical quality2,6901,534696273114812F2i Reti ItaliaGroupEni (Italgas)Gas NaturalG6 Rete GasHeraOthers44%25%11%4%2%14%% incentivescompared to totalIncentives distributed by AEEG for safety recoveries(1) (thousands €)13%33%2%5%5%48%% clientscompared to total(1) Includes incentives distributed during 2010 per number of odorization measurements and dispersion in the network