|First buyback for quite some time:
13 February 2017
NB Distressed Debt Investment Fund Limited
Transaction in Own Shares
The Company announces that pursuant to the general authority granted by shareholders of the Company on 24 August 2016 to make market purchases of its own New Global ordinary share capital ("New Global Shares") it repurchased 50,000 New Global Shares at a price of 79.90 pence per New Global Share, to be held in Treasury, on 10 February 2017. This represents approximately 0.045 per cent of the Company's current issued New Global Shares.|
|Do you trust the earlier investments though!|
|I'm in at an average of 68.4p, thnx to buying more on that absurd dip to the low 60's.
With an NAV of c94p currently; and with c20% being invested in Q4'16 & Q1'17, it is surely unlikely that anything less than 110p will be the final result. A return of 7.5%pa on that 20% alone would provide another 5p of upside over 3yrs...|
|I'm cautious on the NAV return here, if this returns par, this would be fine for me and I base my purchasing decisions based on that. I have the luxury of a entry point around 65p.|
|My enthusiasm has been tempered by subsequent events. I would be delighted with 110p.|
|jim - yes, NBDG is my largest holding at 15% allocation - this versus my usual MAX of 10%. So, very confident that they will recover par ...and then some. I believe Tilts was, and perhaps is still, going for a higher return than 110p.
Ie, thanks to currency moves and the discount, the return from here is very acceptable. But, at the end of the process, the Managers will have delivered a pretty lamentable performance - hence Tilts' justifiable opinion on their overall competence.|
How confident are you they will deliver 110p? Is this one of your largest positions?
|NB - they give us a 7%GRY even if they only deliver par...|
|tiltonboy, I appreciate your judgement on these matters but surely the current discount to NAV reflects any uncertainty about management (as discounts usually do) and, assuming the declared NAV is reliable, the prospects from here are low risk with the potential for an appealing gain over the next couple of years or so?
Edit: crossed with Skyship's post.|
|Tilts - True - but even I have to admit to taking a loss on occasions!
Agreed in principle however.
NB Partners lauded as such a talented operation controlling $26bn in funds, but their managers here haven't done their reputation much good. That said, they state: “We remain confident about the investments in the portfolio and the ability to generate positive returns from the current valuations.”
Of course, would certainly hope so, so that statement is rather nuanced, rather irrelevant actually.
Still, we should see 110p+; so take an average of 3yrs to 31/03/20, then for a target of 110p the GRY at 81p = 10.25%.
Am happy to hold for that…|
|Isn't that like any portfolio though Tiltonboy, you get out performers and under performers. I've certainly had shares that I've held for 2 and a half years and lost money.
The nature of the distressed debt asset class must mean that there has to be an element of doubt in any purchase.|
It's not that investment per se, it's their ability to invest!
They invested 6% of NAV in the company, held it for two and a half years, and lost money!
Do we really trust them to invest the remaining funds!
Can't wait to get out of this shambles.|
|No problem there surely. Postion closed with just a small write-off of 0.4m - nothing in the scheme of things. Perhaps you read the Total return as the total remittance rather than the return on investment (ie loss) it actually is!|
|I wouldn't trust them to invest the money, but you can bet your bottom $ that they will be fully invested by 31st March, so they can rake in maximum fees.
This concerns me:
NBDG purchased AUD 21.3 million face value bank debt secured by a concession to operate a toll road linking Brisbane's central business district with its airport. In 2013, the operator had been forced into an insolvency process when restructuring negotiations fell apart amidst poor traffic numbers. NBDG purchased the bank debt when a sale of the concession failed to materialise and caused certain original bank holders to exit. NBDG sold the majority of the position to reduce exposure after another debt holder amassed a position that would allow them to block a sale of the concession. The concession was ultimately sold in early 2016 to a strategic buyer who owned other Australian toll roads. Sale proceeds were unfortunately less than expected. The total return was (GBP0.4 million) with an IRR of (11%) on the investment and a ROR of (7%).|
|92% invested at end Dec'16 & this Extract from today’s Qtly portfolio update suggests fully invested at end Mar'17:
“We continue to evaluate and bid on what we believe to be attractive investment opportunities in the real estate, lodging and casinos, shipping, international infrastructure and energy sectors, and expect to be fully invested by the end of the first quarter of 2017. We remain confident about the investments in the portfolio and the ability to generate positive returns from the current valuations.”
|Only 7 weeks to go until they can't invest our money.
Roll on the distributions!|
|NBGD NAV 8 Feb 94.44p|
|I'm waiting for the Q4 factsheet before I decide my course of action. Having predominantly bought stock at or near the lows, I may ease a few out as the price rises, and if I have a perceived better idea.
I think $1.10 should be conservative, and only time will tell how much they got wrong.|
|They were coy when questioned, and used the phrase "we can't lose any more" I found them evasive, and I wouldn't touch the Managers with a bargepole again.|
|Tilts - stats extracted from the qtly factsheets show the following Oil&Gas valuations:
# Sep'15 - £8.15m
# Dec'15 - £5.3m + talk of writedowns - see below
# Mar'16 - £6.78m
# Jun'16 - £9.34m + talk of £1.5m upward revaluations
# Sep'16 - £9.67m
What we don't know is what part of the increase in 2016 was down to purchases; but it could well be that the O&G position is not as bad as we may have thought.
What final value do you now think may be achieved here? I'm looking for 110p by Dec'19 for a GRY of 10.65% @ 81.5p.
NBDG's NAV was impacted during the quarter by significant gains/losses in energy and utilities, post reorganisation equities and infrastructure investments. Significant events were:
-- Exploration & Production (E&P) investments were negatively impacted by further declines in underlying commodity prices. WTI oil prices were down approximately 18% during the fourth quarter while the Henry Hub (US Benchmark) natural gas prices fell approximately 7%. Unlike other sectors in the portfolio that have been marked down and we expect to recover, some portion of this decline could be permanent.|
|I wonder if they can get anything back on the O&G debt, following the recovery in markets. This is an area where they really messed up big style, and will tarnish them.|
|Interesting to note that the only buybacks recently have been of the Extended Life stock; perhaps no NBDG available. As Tilts has previously stated, the Market is likely to be short, so even a small 5k buyer lifts the price.
With the NAV at 96.54p; the discount at 16% and the end of the Investment Period just 11weeks away, we could soon be hitting the middle of these three purple lines:
free stock charts from uk.advfn.com|
|NAV now over 96p, aided by sterling weakness. Not that I'm counting, but only 11 weeks left of investing for the Managers. Lets get the returns back in short order.
Can't see them coming back with another fund after this shambles|
|Added 5k myself, but had to place a limit order - not much free stock about.|