Oakley Capital Investments Share Discussion Threads

[donald pond] 21/9/2021 17:04

O/T I bought some PSH today. Crazy discount there and going to get a massive uplift from the Universal Music float. Sorry to be off topic, but I think those holding OCI are likely to fish generally in the more specialist fund area and I thought it worth sharing as I am always looking for ideas.
I also bought HVPE last week, the discount there is really wide. Why OCI and HVPE have wider discounts than PIN and NBPE, which they have outperformed over the last few years, is a mystery. I can't possibly buy more OCI!

[cwa1] 21/9/2021 17:01

Director share purchase:-

[hpcg] 15/9/2021 11:27

North Sails shouldn't really be as it services the well off. Covid just a one off, not an existential or structural threat.

[brexitplus] 15/9/2021 09:26

With, according to the interim webcast, the average holding time being 3.5 years we might expect a few sales in the offing.

[biggest bill] 15/9/2021 08:52

I expect North Sails to be sold or floated in the next year or so.

[essentialinvestor] 14/9/2021 22:02

North Sails and TMO are at least partly a reason for the discount.

[brexitplus] 14/9/2021 11:27

I might be interested in some of these if retail investors get a look in

“An investment group created by banking giant Goldman Sachs has confirmed plans to list on the London Stock Exchange.

Petershill Partners, a minority stake owner in multiple alternative asset firms, could be valued at up to $5billion (£3.6billion) from the listing, which will see it become a standalone company.

The group also plans to raise $750million (£542million) by issuing new ordinary shares from the initial public offering to purchase more stakes in the alternative asset management sector.”

[cwa1] 14/9/2021 09:57

We think Oakley’s focus and expertise in specific sectors, its proven ability to source investments (new, or bolt-on) through its proprietary network of entrepreneurs and its discipline in terms of pricing and valuations means OCI is highly differentiated to peers. This differentiated approach has paid off for investors, given that apart from 3i and HgCapital – which both trade on premiums to NAV – OCI is the next best performing trust in NAV terms over five years. The next NAV announcement is due to be announced in January 2022, and from then on, on a quarterly basis.

[davebowler] 14/9/2021 09:30

Liberum;
Event

Oakley Capital Origin Fund has agreed the acquisition of Seedtag, a contextual advertising company in EMEA and Latin America. Oakley Capital Investments' indirect contribution via the Origin Fund will be £7m. Following the transaction, OCI will have liquid resources of £152m (19% of NAV).

The Origin Fund is investing $35m in Seedtag. The business was established in 2014 and helps brands to deliver digital advertising that is directly relevant to the content that readers are consuming. The proceeds will be used to finance the expansion of the business in to the US and to fund further investment in its technology. Seedtag's proprietary software is well-placed to provide a strong understanding of consumer interests as it does not rely on the use of third-party cookies.

Seedtag's revenues are expected to increase 60% this year to $80m. Existing clients include brands such as Universal and Adidas and agencies such as WPP and Havas. Seedtag also partners with premium publishers including the FT, The Guardian and Sky.

Liberum view

The transaction originated from a long-standing relationship between Oakley and Seedtag's founders, illustrating Oakley's differentiated origination strategy. Over three quarters of Oakley's acquisitions have been in uncontested deals. Despite a competitive investment market, Oakley has consistently been able to acquire at attractive multiple due to its focus on proprietary transactions (average 10x EBITDA across four acquisitions in H1). Oakley has a strong track record in the media sector and in growing digital businesses.

We believe the portfolio remains very conservatively valued at a 12.3x multiple. Oakley has reflected a much smaller change in multiple than peers in recent years. The digital-focused portfolio is generating consistently high EBITDA growth (35% over the 12 months to June 2021) and offers substantial NAV upside potential. The current 21% discount to NAV is 14 percentage points wider than the direct peer group (ex-3i), which we regard as a compelling entry point.

[brexitplus] 14/9/2021 08:46

Re Seedtag, Martin Sorrell at S4 Capital talks a lot about the demise of cookies and how S4 is at the forefront of this area.

[donald pond] 14/9/2021 07:05

New investment and looks like it is a good sector.

[cwa1] 13/9/2021 15:20

Valuation
The charts below show the premium/discount ratings of OCI’s closest competitors,
together with their five-year total NAV returns. Despite having one of the best five year returns among its peers, OCI has the highest discount. Indeed, the two peers
with comparable returns are trading on material premiums to NAV. To have such a
relative discount appears anomalous with historical performance, where Fund III is
in the top 5% by peer benchmarking. Taking an absolute rating perspective, it also
appears anomalous that a company with a strong track record of growth and value added should trade at any discount to NAV at all.

[cwa1] 13/9/2021 11:00

Must...not...buy...any...more...

[davebowler] 13/9/2021 10:55

There's a group call with Liberum today at 2.15 which might prompt some improvement in the share price....

[biggest bill] 13/9/2021 10:53

I expect the discount to narrow over time as more people become aware of oci's record and prospects. I regard the current price as a tremendous buying opportunity. In two or three years time, people will wonder why this was trading at a discount at all and wishing they had taken advantage of it.

[donald pond] 13/9/2021 08:57

Agree hpcg and I have lots of OCI. The discount as I see it is a safety net. I'm not banking on it narrowing but when combined with conservative valuations it gives some assurance one is buying far below the intrinsic value of what are imo largely high quality assets

[hpcg] 11/9/2021 11:18

I'm not fussed by the discount, and if anything it represents substantial upside potential either from the tax free asset value compounding of buybacks or from the prospect of the discount tightening. The former is much more likely IMO, many London investors are stuck in the past when it comes to PE, not least early stage PE.

[1968jon] 10/9/2021 11:08

To be absolutely clear that is not my suggestion! It is just that I, like Dubens, am very happy to own a bundle of them, keep adding at what I believe/hope are pennies on the pound and compound up at 10ish percent regardless!

[shaker44] 10/9/2021 10:46

maybe the non execs should implement an ltip based on the share price AND discount- that is if they are not acting in concert with the executive. What a suggestion!!!

[1968jon] 10/9/2021 09:48

HGT EV/EBITDA 31/12/20 22.1 30/6/21 25 +13%
OCI EV/EBITDA 31/12/20 11.8 30/6/21 12.3 +4%

I know, I know, different businesses....

[1968jon] 10/9/2021 09:24

Yes, the specialist fund segment is a nonsense for a company with a professed interest in narrowing it's discount by appealing to a wider investment community.....but typical of OCI. Some of their IR/corporate governance stuff (in my opinion) is a bit more wonky than some of their peers. I can imagine in one investing universe that they're not that fussed? As long as they can keep buying the stock at a discount that only they really know - cash + low multiples compared to peers - what's the problem? Don't get me wrong, I'm sure they would like the discount to narrow but what's the rush? This is a slightly facetious personal view. On the price action - there are still decent sized offers inside the spread at the moment but smaller than last week and quite a lot of volume is going through. Typical previous action would be that the offers go and the stock jumps 5-8p on no news....

[shaker44] 10/9/2021 08:43

Hpcg, I entirely agree. There would be many more buyers if restrictions were removed

[hpcg] 10/9/2021 08:03

Yep, some consolidation showing in the price action, and a turnover of at least some reasonable body of shares. BPCR has a GM to vote on resolutions to allow for a transition to the premium segment. The Specialist Funds segment is a ball and chain to liquidity and thus valuation.

[spin doctor] 09/9/2021 21:31

A remarkable share price chart. Thankyou recent seller(s). An ongoing gift.

Yes, HL not live quote/dealing, but fill/kill has been straightforward for me, resulting in prompt deals at 352 or so.