There are some exceptions to that. BHS and Debenhams I think are two good ones. They both owned a lot of their own retail outlets, but their buyers sold the retail outlets for cash now in return for rental payments, increasing their operational costs going forward. The increase in operational costs and the decline of the high street contributed to both declines. The Private Equity company I think for Debenhams got out with a profit before the issues became apparent.
PS presently invested in 3i, HG capital and nbpe.
3i is at par but normally trades on 20% plus premium.
HG capital trades in and out of premium. Average about 5% premium.
NBPE is normally on an undeserved 20% discount. It has a very large amount of vintage investments 2017 2018 2019 all of which should be ready to sell on. Assuming they don’t wait till after the probable recession.
It also has a very decent dividend of 5% assuming it continues paying it it is useful as private equity is very volatile, so less need to sell shares. Bought NBPE 7th February was up 9% but only up 6% today!! I can live with that.
All 3 are direct investors IE they buy and run the companies. There is a view going round that some private equity are buying companies of other private equity and are over paying. Not sure that investment trusts buy companies of other private equity companies.
Either way if it’s correct the direct investors are not buyers but sellers. In other wards if it’s true they will be beneficiaries.
When selling a company the uplift average is 20% above there valuation in the pe portfolio.
3i is in the process of selling a company to another private equity company (not an investment trust) for a 50% uplift!!
I am talking about private equity investment trusts were they bought by investment trusts?
Only allowed 8 posts so am also replying to your post above
Institutions steadily buying increasing their stake in Vodafone, could takeover be on the table
I thought they were expected to merge with three or orange, one of the two.
Their debt pile is too big imo and margins squeezed too much. It’s difficult to argue a good investment case with the current board despite good cash flow.
It doesn’t seem the merge talks developed any legs, haven’t researched tho. As per debt pile i thinks it’s common with the communication sector but yeah they’ve got too much debt.
Sharecast News) - Vodafone is reportedly putting final touches on a deal with Three UK to create Britain’s largest mobile operator and may announce details of the tie-up as soon as this month.
According to Bloomberg, Vodafone and Three UK’s owner, CK Hutchison Holdings, are working through the last details of the structure of the deal, and ways to address potential antitrust issues surrounding it.
Vodafone and Three UK’s parent CK Hutchison confirmed in October that they were in talks to merge their UK businesses.
I just wish I had more funds to invest in Energy right now.
I’m waiting for another dip on RR and CWRs valuation looks deflated right now. The problem with both is RR has 3bn in debt and only 0.6bn expected free cash flow this year. They need to invest and clear that debt(albeit servicable), to rerate upwards.
CWR as far as I can see have sufficient cash levels to see themselves through to profitability in the next 5-10 years once recurring revenues kick in from contracts.
Another outlier could be NanoCo. It’s difficult to say exactly what could accelerate its share price up now from existing levels, but with an mcap of 72m, and expected to retain upwards of $90 out of the $150m settlement with Samsung, they’re effectively being valued as cash.