British Empire Share Discussion Threads

[davebowler] 01/3/2018 08:35

One of BTEM's holdings-
Liberum
Pershing Square Holdings (Mkt Cap £2,251m)

Up to $300m tender offer directly by the company

Event

The Board of Directors of Pershing Square Holdings (PSH) intends that PSH should conduct a tender offer to purchase up to an aggregate amount of $300m of its publicly traded shares (Tender). PSH anticipates that the Tender would be structured as a Dutch auction which is priced at a discount to PSH’s prevailing NAV per share.

This is after PSCM Acquisition (PSCMAC) withdraw its previously proposed tender offer due to the Dutch Authority for Financial Markets interpretation of certain applicable rules regarding the proposed tender offer, which, in PSCMAC’s view, make the tender offer not feasible.

The Tender will be subject to applicable shareholder approvals, including a vote to remove the current 4.99% shareholder ownership limit, which will be sought at PSH's upcoming AGM on 24 April 2018. It is expected that the Tender would be launched shortly following the AGM and would be financed from PSH's cash on hand.

PSH is trading at a 19.7% discount to its 20 February 2018 NAV per share.

[skyship] 06/2/2018 17:38

Interesting - over the past two weeks to yesterday 5th Feb:

# The FTSE fell 5.1% from 7732 to 7335
# BTEM share price fell 3.9% from 748p to 719p
# BTEM NAV fell just 2.8% from 840p to 816p

Yet the share price was hammered back to 688p first thing - so pleased to buy back in having sold out @ 746p at the start of that fall.

[skyship] 09/1/2018 08:12

5th Jan'18: NAV (Debt at par value) - 836.90p. Sp 747p - 10.7% discount.

[skyship] 05/1/2018 14:28

NAV @ 830.96p & a nice move up as the share price rises to 743p - a 10.6% discount - still in double figures!

[skyship] 04/1/2018 17:06

NAV @ 821.30p & a nice move up as the share price closes +12p @ 736-738p - a 10.2% discount

[skyship] 30/12/2017 11:44

Personally I work with the "Debt at par value" rather than the mark-to-market "Debt at market value" as surely it is only really the former which will apply.

Added again yesterday @ 723p...

[davebowler] 30/12/2017 10:24

Yes, compared to WTR a similar Investment Trust which is trading at a 5% discount to NAV, this is a bargain.

[davebowler] 30/12/2017 10:22

28 Dec Net Asset Value -- Debt at market value: 806.67 pence

[skyship] 21/12/2017 14:35

Creeping ahead again; but still available at a 10.8% discount whereas surely performance deserves closer to 5% - ie an share price of c770p!

[skyship] 20/12/2017 16:59

Net Asset Value -- Debt at par value: 812.94 pence

[davebowler] 19/12/2017 16:39

Interestingly it shows the look through P/E of BTEM's portfolio as averaging about 10x

[davebowler] 19/12/2017 14:14

Its at the end of the article..........these include the likes of Aberdeen Emerging Markets, JPMorgan European Income, and British Empire Trust and Standard Life Equity Income – with a breakdown of each trust’s credentials shown in the table above.

[skyship] 19/12/2017 14:12

DB - thnx, but not immediately obvious where the mention might be...

[davebowler] 19/12/2017 13:40

Honourable mention here -

[tiltonboy] 18/12/2017 16:52

I wonder if somebody would like to do a similar thing to another of BTEM's large PE holdings...JPEL. A nice clean exit at a modest premium to NAV would be welcomed here!

[davebowler] 18/12/2017 16:39

18 December 2017

Aberdeen Private Equity Fund Limited (the "Company")

Strategic Update

Following consultation with the Company's largest shareholders and an extensive process to identify potential purchasers, the Board announces that the Company has entered into a Sale and Purchase Agreement (the "SPA") to sell its entire investment portfolio at a modest premium to its 31 October 2017 valuation, net of associated sale costs.

Background

In the course of engagement with the Company's shareholders following the AGM in September, it has become clear that a substantial majority, representing approximately 69% of the issued share capital, no longer wish to remain invested. The Board understands that the reasons include variously a change in certain shareholders' investment objectives, the discount to net asset value at which the Company's shares have traded, the Company's size and limited liquidity.

In order to meet the aspirations of shareholders who wish to realise their shares at the best possible price, the Board commissioned Campbell Lutyens, a specialist in the restructuring of private equity portfolios, to ascertain potential secondary market interest for the Company's investment portfolio. Pursuant to that process, proposals were received from a number of interested parties and it was determined that the highest bid was the most attractive option.

Investment portfolio sale and return of capital

The proposed sale is subject to a number of conditions contained within the SPA, including, but not limited to, shareholders approving a change in the Company's investment policy to that of a divestment policy to enable a sale of the entire portfolio to be made. Under the SPA, Aberdeen Standard Investments will enter into a new investment management agreement with the purchaser to manage a portion of the portfolio, which includes the Company's co-investment assets. It is intended that following completion of the sale and the capital return to shareholders, the Company will be placed in liquidation.

It is expected that the bulk, if not all, of the proceeds from the sale will be received in one tranche on or soon after 31 March 2018, and it is the Board's intention to return capital to shareholders as and when proceeds are received. It is estimated currently that the total return to shareholders will be close to net asset value as at 31 October 2017, however the proceeds received from the purchaser and the final shareholder return will be subject to various factors including, but not limited to, foreign exchange fluctuations and liquidation costs.

The Company will issue a circular in early 2018 to convene an extraordinary general meeting ("EGM") to approve, inter alia, the change of investment policy, the mechanism for shareholder returns and to provide further details, including the expected timescale for the return of capital to shareholders. Shareholders representing 69 per cent. of the Company have given irrevocable undertakings to vote in favour of the resolutions at the EGM.

For further information, please contact:

William Hemmings

Aberdeen Fund Managers Limited

[skyship] 18/12/2017 15:23

Well done BTEM - APEF, one of our largest holdings, jumps 15% on portfolio sale news & capital repayment next Spring:

[davebowler] 22/11/2017 15:20

21 Nov Net Asset Value -- Debt at market value: 813.80 pence

[davebowler] 21/11/2017 11:50

17 Nov Net Asset Value -- Debt at market value: 803.14 pence

[vacendak] 12/11/2017 15:34

The usual take on BTEM: What is meant by "value", investing with old money and the big shift of late towards Japan:


The Japan bit has some newish pieces of news about it about forcing companies to sell their shareholding in other companies.

[davebowler] 07/11/2017 13:22

3/11 Net Asset Value -- Debt at market value: 812.91 pence

[vacendak] 03/11/2017 14:20

@riverman
Good catch, thanks.

BTEM invests in "old money" trusts and Hansa is also "old money" from what I have gathered.

Blast from the recent past (BTEM exited HBC) for those of us with premium access:

Hudson's Bay Company (HBC) or "Compagnie de la Baie d'Hudson" in French Canadian is eagerly fighting Signa, an Austrian company, to buy a German department store.

[Excerpt]
"Since listing in 2013, Hudson’s Bay has arguably shown more flair for real estate than retailing. Yet as Sears found out, financial engineering can only take you so far. A comparison of the share price of Metro (now called Ceconomy) with that of Hudson’s Bay since the original deal completed suggests getting out of department stores is the wiser choice — in Germany or anywhere else."

Ironically British Empire dropped Hudson's Bay when they realised HBC were not going to sell the real-estate, or even spin-off into a REIT like entity. So the FT comment is a bit off-key.

[riverman77] 31/10/2017 19:44

I found some very insightful commentary on Exor (one of BTEMs top holdings) on the Hansa trust factsheet of all places, which I thought was worth sharing (interestingly Hansa also has a position in Pershing Square).

We built a position in EXOR during the third quarter. EXOR is a holding company controlled by the Agnelli family (53% share) which holds stakes in Fiat Chrysler, CNH Industrial, Ferrari, PartnerRe, Juventus and The Economist. The Chairman and CEO is John Elkann who is a member of the Agnelli family. He has done an outstanding job since taking over in 2003 and created a huge amount of value for shareholders. Since becoming public in March of 2009 the total return of EXOR is 947% versus 228% for the MSCI World Index. The annualised return of over 30% speaks for itself. His ability to take a long term view thanks to his family’s large stake in the business is invaluable; he can afford to avoid focusing on quarterly and even annual results, unlike many of his peers in the wider market. During his tenure he has spun off Ferrari, bought back stock when EXOR was trading at a 40% discount, used those shares at a higher price to buy the insurer PartnerRe, diversifying the Company away from cyclical end markets, and alongside FIAT CEO Sergio Marchionne he engineered a deal with the bankrupt Chrysler to buy it, using Chrysler’s own cash. At the holding company level, he re-domiciled EXOR to Holland in order to reduce the tax rate to less than 1.5%, he reduced the number of employees from 40 to 10, and he cut overall head office costs (including his own salary) to less than 10bps of NAV. The proportion of independent directors on the board has moved from 24% in 2009 to 53% today. Finally, and perhaps the most telling, he created a structure whereby holders of EXOR’s companies receive enhanced voting rights related to the length by which they have held the shares. Just because management are aligned with shareholders and it has a strong track record, it does not necessarily follow that the company is a good investment; to quote Elkann “one more condition which I believe is indispensable: the price must be right”. EXOR trades at 70% of the value of the sum of its underlying holdings, which provides us with a margin of safety. However, we believe that the holdings are themselves undervalued, so the discount to intrinsic value is actually much larger. On this basis, if EXOR can compound its returns at just one-third of its historic rate then it should be an excellent investment.

[vacendak] 27/10/2017 16:09

One of the few "value" stocks that manages to shine these days.
Very impressive year-and-a-half-to-date (or 78 weeks), to select the optimal positive window.