UK fund 3i sees NAV rise despite fallout from oil and gas slump

LONDON (Reuters) - British private equity firm 3i (III.L) sold 307 million pounds of assets in the half year to the end of September, and saw its net asset value (NAV) per share rise despite what it described as a deteriorating market environment.

The company said on Thursday it made a 26 million pound profit on the asset sales.

Its diluted NAV - a key measure of the value of its assets -rose 12 percent on the previous year to 401 pence. 3i invested 208 million pounds in the six months ended September and said it would pay an interim dividend of six pence a share.

However total returns on opening shareholders' funds fell to 4.4 percent, down from 7.1 percent the previous year, partly because of the market squeeze from falling oil and gas prices.

"We're not exposed to China-specific stuff, we're not directly exposed to oil and gas or commodities, but there has been a general tightening across quite a lot of economies," said Chief Executive Simon Borrows.

Borrows noted that portfolio companies including JMJ, a safety management consultancy with a focus on the oil and gas industry, had sought to cut costs.

"It's really about that ricochet out of these more difficult situations into the industrial sector," he said.

3i said it expected to pay a full year dividend of at least 15 pence a share.

The British fund has been streamlining and reached the end of a three-year restructuring in May. It is still seeking to reduce its portfolio to fewer than 40 companies.

Sales in the period included the disposal of French medical diagnostics firm Labco to Cinven. As of the end of September, 3i held 53 assets in its portfolio, as well as five listed stakes.

Simon Thompson took over as Chairman from Adrian Montague earlier this year. Thompson is also Chairman of Tullow Oil (TLW.L).

(Reporting by Freya Berry; Editing by Emiliano Mellino and Mark Potter)