Permira, the private equity house, is facing hundreds of millions of pounds of writedowns on companies that it bought at the top of the market.

SVG Capital, the listed fund that backs Permira, told investors yesterday that it had written down the value of 13 of the buyout firm’s biggest holdings in companies by £467 million. Permira is not bound to follow SVG’s valuations when it revalues its portfolio this month, but the figures are likely to be broadly similar.

Permira declined to comment, but a source close to it emphasised that it could hold its companies for five or six years, by which time asset prices might have rebounded. However, the firm’s timing has been particularly bad. The private equity house invested heavily between summer 2006, when asset values were at their highest, and this spring, when prices collapsed.

SVG has written off the value of two of Permira’s businesses and reduced two more to a nominal £1 million valuation. Among other impaired investments, Permira bought 51 per cent of All3Media in September 2006 in a deal that valued the whole company at €484 million. Principal Hotels, which owns the Russell in London and the George in Edinburgh, was bought out by Permira for €487 million in the same month. The value of Birds Eye Iglo, the frozen-food business, was cut from £32 million to £13 million.

The biggest writedowns were on Permira portfolio companies in Italy, the United States and China. SVG cut its valuation of a stake in Valentino Fashion Group, of Italy, from £144 million in June to £49 million this month; Freescale, a US IT company bought in November 2006, was slashed from £121 million to £36 million, and Galaxy Entertainment Group, of China, acquired in November 2007, was cut from £66 million to £10 million.

The Times revealed yesterday that SVG had called in JPMorgan Cazenove to investigate a capital raising. The listed fund is raising £200 million in a heavily discounted rights issue to bolster its balance sheet. It is expected to announce this morning that it has completed the issue.

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