Yea resigns from beleaguered 3i

3i veteran Michael Queen will now steer the firm, whose top 50 investments lost £682m in the past nine months. Last year, 3i invested a total of £841m, down dramatically from the £1.8bn the prior year. 3i's share price has plummeted in recent months, this morning losing nearly 4%, giving it a £941m market capitalisation.

Philip Yea has ended his five-year reign as chief executive of 3i, handing control of the beleaguered private equity firm to 20-year firm veteran and infrastructure head Michael Queen.

3i chairman Sarah Hogg said in a statement the move was to “assist the transition to the next generation of leadership”, though it coincides with a tumultuous time for the listed private equity group.

Philip Yea

The firm's share price has fallen drastically in recent months, collapsing from peaks of £10.05 in January 2008 and £9.56 in August last year, to just £2.46 in mid-December. This morning 3i’s shares were again trading down approximately 75 percent from their peak at just £2.46 per share. This collapse has fuelled rumours that the listed firm will take its fund private.

3i said today that its investment portfolio lost 53 percent in the nine months ended December 31. Its top 50 investments, which accounted for 61 percent of the £5.9 billion portfolio value at 30 September, lost an estimated 21 percent, or £682 million, during the period.

“Since we published our half-yearly results in November, conditions in the real economy have been very

Michael Queen

challenging and credit markets have remained dislocated,” Julia Wilson, 3i's finance director, said in a statement.

During the last quarter, 3i invested £173 million, and made realisations of £345 million; this compares with investment of £544 million and realisations of £429 million in the fourth quarter of 2007. Last year, the firm invested a total of £841 million, down dramatically from the £1.8 billion it invested in 2007.

Yea had replaced Brian Larcombe as group chief executive in May 2005, having notably turned down the chief executive job at property company British Land. He was previously a managing director at Bahrain-based private equity firm Investcorp from 1999 until he joined 3i in 2004. He had previously been group finance director at Diageo from 1997 to 1999, and prior to that, finance director at Guinness from 1993 to 1997.