FTSE 100 company 3i Group has seen its share price drop more than 16% today (writing at 1.30pm) – wiping billions off its valuation – despite posting a positive half-year trading update.
The private equity firm reported a total return of £3.3 billion or 13% on opening shareholders’ funds for the six months to 30th September 2025, compared with £2bn/10% in the corresponding period from the prior year.
Net asset value per share was 2,857 pence, up from 2,542p in the six months to 31st March 2025.
It said that 98% of its private equity portfolio companies by value grew earnings in the 12 months to 30th June 2025.
However CEO Simon Borrows sounded a note of caution, saying that 3i “remains cautious in deployment of capital into new investment”.
The subsequent drop in share value puts them at their lowest level since April, and gives it a market capitalisation of £34bn at the time of writing (1.30pm).
Originally founded in 1945 by the Bank of England and other banks as the Industrial and Commercial Finance Corporation, 3i Group was created in 1987 when the banks sold off their stakes. In 1994 this limited company was floated on the London Stock Exchange with a market capitalisation of £1.5bn.
3i’s private equity team completed the realisation of MPM and signed the realisation of MAIT in the reporting period, generating £542m of proceeds, with money multiples of 3.2x and 2.8x respectively.
“The total return of 13% represents a very good first half for the group,” said Borrows. “Our long-term hold assets, Action and Royal Sanders, continued to deliver excellent compounding returns.
“Against a challenging macroeconomic and geopolitical backdrop, our private equity portfolio has maintained good momentum, while the infrastructure asset portfolio within 3iN outperformed its expected returns for the six-month period. The strong realisations of MPM and MAIT further demonstrate the strength of our disciplined investment strategy and active asset management.
“We remain cautious in the deployment of capital into new investment, but will continue to allocate selectively, including to lower-risk reinvestments in businesses we know and trust. We are mindful that both the transaction market and the wider environment are likely to remain challenging into the second half of our financial year.”