North Atlantic Smaller C... Share Discussion Threads

[chinahere] 24/12/2021 00:52

2020-21 has been easy after the pandemic, but I reckon UK stocks are still cheap going into 2022.

Christopher Mills knows what he is doing here as far as I can tell and the discount to NAV in NAS makes me happier. Some earlier buybacks may look stupid, but in the long run they can't be stupid if the buy price is always under the NAV.

On a similar note. There are loads of people that are hanging around on SPAC type investments thinking that their unknown new investment company will make money for them. Totally crazy I reckon!!

We have here a successfully proven manager with a trust that is trading at 20% or more under the NAV.

This is much better IMHO.

[p1nkfish] 23/12/2021 23:54

He does make it clear next year probably won't have as easy pickings. The share price currently agrees and any limit on the buyback won't help support the price. The issue with these types of interviews is the manager talking their own book and although all the stocks mentioned have merits, again, it looks like easy pickings have been taken.

2022 won't be a repeat of 2021. Granted the companies mentioned look solid with growth but I'm of the opinion there could be a better time to enter some in the next 3-9 months. Currently they have seasonality and exuberance on side.

It's interesting NAS are sitting on so much cash after the AUG event. Do they think there could be a better time ahead to allocate - at lower prices?

I hold NAS, have sold none since building a holding a few years back, and look forward to £50+. I just don't see 2022 being as easy as the past March 2020 period we have just been through.

Looked at the TA on all the companies mentioned.

[apple53] 23/12/2021 23:31

Thanks Dave.
Very interesting. It's always tempting to co-invest in a couple of these. I don't find Curtis Banks quite as cheap as he does, but almost everything else I'm not qualified to comment on.
I would love to know why no discussion of renalytix.
Secure Trust should be up his street but maybe he avoids proper banks.

[p1nkfish] 19/11/2021 13:45

Excellent. Eating their own cooking.
More value here than many other places.

[p1nkfish] 19/11/2021 13:45

Interesting to see what happens when it is finally through 50 GBP.

[spartacus mills] 19/11/2021 13:36

Largest ever share repurchase by NAS announced this morning.

170,00 shares at £49 each. £8.3m in total.

Against a running NAV of`c. £62.50 this adds c. £2.3m or 22p per share to NAV.

Good to see Mills move aggressively given the persistent discount and the large cash pile

[apple53] 15/11/2021 12:16

Thanks mw.
I wonder what Spartacus' spreadsheet is saying. Oryx is obviously the big negative, though it has bounced somewhat, and it has taken advantage of its discount to buyback stock. To be fair I never really understood why its discount shrank to almost zero when NAS sits where it is.
Polar and Renalytix are both up materially since end Sep.

I'm guessing real-time (NOT end Oct) NAV around £63.5-64.

[mw8156] 11/11/2021 23:03

apple,
it's antler holdco, the holding co for ii admittedly, you're correct, only a £3-4m entry in the last annual report.
oryx also has a stake, though so economic exposure is higher,
all this offset to an extent by the fall in gyg in the last several days,

[apple53] 11/11/2021 11:14

Thanks mw8156.
I think I vaguely knew (was it mentioned in the Chris Mills interview?). Checking back to the annual report which had the top 20 holdings end Jan it wasn't mentioned, so unless he's built it up more recently, I guess it is/was below £10m.

[p1nkfish] 10/11/2021 10:25

GHS look like keeping Harwood for run-off period and probably needing to find homes for the likes of ULS, VAN, FLO, RPS, CAU, NBI, PRES. Strange state of affairs and might be some decent picking for NAS, Oryx?? Who knows, worht keeping an eye in though for interest.

[mw8156] 08/11/2021 19:16

has a stake in interactive investor.

[p1nkfish] 15/10/2021 20:39

Potential shenanigans at Gresham.

Htps://www.londonstockexchange.com/news-article/GHS/announcement-re-strategic-review-and-requisition/15176255

[p1nkfish] 12/10/2021 07:47

They already split holdings amongst trusts.

[ceaserxzy] 11/10/2021 22:25

Chris Mills holding over 26% of nas is the best assurance that you can ask for that nas interest won't be compromised.

[topvest] 11/10/2021 21:39

It is positive as it gives Harwood more firing power. Often Oryx and NASCIT hold the same stock. I hold Gresham House Strategic and am also a shareholder in Gresham House which I think is a good investment manager. However, in my view Harwood are better. Why? Because they have about the best value record in the small cap space through their activist and entrepeneurial style. Gresham House are good for up to 10% returns per annum, but Harwood are good for > 10% per annum in my view.

[18bt] 11/10/2021 15:41

Pinkfish - so if Harwood found another Augean, which one of their investment trusts would buy the stake?

[davebowler] 11/10/2021 13:39

FinnCap -

About GHS:

High conviction UK small cap fund (15-20 holdings) applying private equity techniques to listed smaller companies



The Board of Gresham House Strategic announced this morning the conclusion of its Strategic Review. The key points are:

With immediate effect, Harwood Capital LLP has been appointed as the Company’s new Fund Manager to replace Gresham House Asset Management.
Richard Staveley, who managed the GHS portfolio while at Gresham House from 2019 to 2020 and delivered strong performance, will join Harwood on 1 December 2021 as lead fund manager for the Company.
There shall be no material change to the Company’s existing investing policy.
It is proposed that the Company’s name be changed to Rockwood Strategic plc.
Fees shall be reduced as follows:
the management fee will be reduced from 1.5% to 1.25% up to £25m and 1.0% above £25m (all as a % of NAV);
the performance fee will be reduced from 15% to 10% and the hurdle will be reduced from 7% to 6%, but the catch-up will be removed; and
if the NAV of the Company exceeds £100m, the aggregate management and performance fees shall be capped at 3% of NAV.
Harwood has offered to buy, at NAV, the current manager’s stake in the Company, which is 23.4%. Additionally, Harwood would buy additional new shares, issued at NAV, for up to 10% of the current issued share capital – subject to its aggregate holding not exceeding 29.9% and with a maximum investment of £18m.
Harwood has also irrevocably undertaken not to exercise any of its voting rights above 10% on any resolution which is proposed at any general meeting, save with the written consent of the Independent Directors.
Our view:

Harwood, run by Christopher Mills, is a very successful player in the small cap sector and runs three other small cap investment trusts with a combined market cap in excess of £1bn: North Atlantic Smaller Companies (NAS, £675m mkt cap, £25% discount), Oryx International Growth Fund (OIG, £255m mkt cap, 7% discount) and Odyssean Investment Trust (OIT, £148m mkt cap, 2% premium). The addition of the Company, with its value/turnaround strategy which is distinct from the other three trusts, makes sense in our view. Bringing Richard Staveley on board as lead portfolio manager and therefore providing continuity of management is also a big positive in our opinion.
The lower fees, the new manager’s alignment of interest (up to 29.9% holding, to be purchased at NAV), the improved corporate governance (voting rights restricted to 10%, independent Board) and the new manager’s commitment to spend its own funds on marketing the Company, paired with continued good performance, should contribute to the Company attracting more investor interest, the discount narrowing and getting to a position where new shares can be issued so that the size of the Company increases so that it is no longer sub-scale.

[p1nkfish] 11/10/2021 12:29

Can you explain please?

[18bt] 11/10/2021 12:02

I’m wondering whether it is a good move for NASCIT - it introduces further conflicts of interest for Harwood in allocating investment ideas.

[p1nkfish] 11/10/2021 11:59

Harwood Capital signed GHS. Good move.

[topvest] 01/10/2021 20:12

Probably no dividend at all this year as the revenue account will be negative given the allocation of cost policy. They have paid a small dividend for a couple of years, but given the COVID-19 impact on dividends I don't expect that to continue. I'm happy for NAS to sit on the cash until better times emerge. I do think markets are going to be choppy for the next 6m or so. It's a great time to be sitting on lots of cash.

[p1nkfish] 01/10/2021 12:21

If patient and able to ignore the dat-day, this is a decent parking place imho.