Oakley Capital Investments Share Discussion Threads

[jellypbean] 27/7/2023 08:47

Also, regarding buybacks, need to remember the PE Trusts have substantive forward commitments to invest in the PE funds. GBP893M in the case of OCI. It was the concern that PE ITs would not be able to make these commitments that killed their share prices post 2008. In the end they managed this well and the discounts proved to be unwarranted. Holding cash is part of the PE model, due to these forward commitments they make.

[kenmitch] 26/7/2023 15:17

Square Root

Without wishing to start another series of pros and cons of buybacks posts it’s perhaps worth pointing out that Pershing Square have now spent £1 billion on buybacks and they failed to reduce the NAV discount which is still around 35%. It looks a buy btw.

And Commercial Property REIT SREI (SCHRODER Real Estate) bought back heavily but the discount is now much wider than it was before they started their buybacks. And it’s questionable too whether buybacks are appropriate for Private Equity Trusts.

Fact is the sector is at incredible bargain levels with quality Trusts like OCI on huge and undeserved discounts to NAV. That will surely correct in time with big share price gains as the discounts narrow a lot. And when that happens Private Equity Trust that bought back might well see that those that didn’t go for buybacks see their share prices rise just as fast.

Also note with reference to SREI, that the best performing REIT longer term is AEWU that hasn’t bought back at all, and what’s more was the only REIT not to cut the dividend after Covid.

[donald pond] 26/7/2023 09:43

Cash is around a third of market cap. If you strip it out the assets are on a 43% discount to NAV. If you then say they could sell the remaining holdings of things they've sold over the last year for the same price, the rest is at a 60% discount by my sums

[square root] 26/7/2023 09:32

According to the statement, net cash is £248m and nav is £1169m which means that net cash is 21% of nav. I think that this figure is too high and some of it could certainly be used for share buy backs.

[donald pond] 26/7/2023 09:28

It doesn't quite say that:The modest increase in asset value reflects the Company's cautious approach to trading outlook and valuation multiples, and the fact that half of the NAV was not subject to change in the period. This results from approximately 50% of the asset value being held in cash, or underlying investments that were valued based upon a transaction within the last 12 months.

[dope007] 26/7/2023 09:27

Probably a good time to be holding plenty of cash as well

[ayl30] 26/7/2023 09:20

If you read the details of the statement it says most of the 50% is straight cash

[donald pond] 26/7/2023 09:04

It is always impossible in my view to argue against buybacks when the discount is so wide

[this_is_me] 26/7/2023 08:31

A buy back at the current discount should be happening. Is it likely that any new investment is going to be better than OCI shares? A buy back might also encourage others to buy the shares if they considered that the huge discount was going to narrow.

[donald pond] 26/7/2023 07:56

Investing into a generative AI led software fund is an interesting move too. OCI has a part that is similar to HGT.

[biggest bill] 26/7/2023 07:40

Ayl30, I don't think that 50% of nav is held as cash. The interim statement said that 50% of the portfolio was held in cash or investments which had been recently valued by corporate transactions.

[biggest bill] 26/7/2023 07:11

Given the amount of cash on the balance sheet, I think Oakley should consider buying back a lot more shares. At a discount of 32%, this would have a significant effect on nav.

[ayl30] 26/7/2023 07:09

50% of NAV held as cash or cash equivalent. Didn't realise that, this together with undrawn credit facility gives it plenty of firepower

[makinbuks] 20/7/2023 11:22

Thanks DP interesting

[donald pond] 20/7/2023 09:14

I dropped Steven Tredget an email about this and it is breaking no confidence to say that he said there is no change of approach. The focus is and remains on Europe, which has much less PE than the US, but the company is opportunistic as well. So no change to the existing (very successful) strategy

[donald pond] 16/7/2023 10:31

I didn't pay attention to the acquisition of Fastlaw in the last trading statement but it looks like a great company. Obviously we don't know the price paid etc but combined with vlex must be world leaders in providing legal information to law firms. It is potentially interesting as it is primarily a US business so perhaps indicates OCI is moving from European to potentially global platforms.

[crita 2] 16/7/2023 10:09

Interim trading statement.

[donald pond] 16/7/2023 09:36

He bought 300k at 4.68 and then 375k in the 440s and 450s, so over £3m worth at a premium to the current price. I'd say that tells us the underlying businesses are doing well

[donald pond] 15/7/2023 20:57

I actually bought a few yesterday. Dubbens bought a load at 470 as well as lower down and I felt it was bowling up

[ali47fish] 15/7/2023 18:49

crita - do you mean an update last yeat results were on 2 august 22

[crita 2] 15/7/2023 12:38

The selling seems to have stopped. Statement out 26 July.

[makinbuks] 13/7/2023 11:17

Yes thanks DB, some interesting short videos