All the PE stocks have taken a bit of a lashing
CTPE begiining of Feb was 530 it is now 460 |
The share price is back down to where it was before the announcement of the asset sale. The big special dividend is due to be confirmed as well.
I assume that the decline is due to Trump 2.0 volatility. But 245-250p seems a potentially interesting (re) entry point. |
I sense this could be rewarding so took a small opening position |
Welcome aboard, its been a bumpy ride so far. Why now? |
i'm dipping my toes in this is an interesting one |
Several broker upgrades this morning. Onwards and upwards... :) |
reassuring that the sale was at a 62% premium to book value - bodes well for the rest of the holdings.
Unusually, I received loan notes as part payment in a takeover early last year, at 12% pa, paid quarterly and compounded! |
Excellent job by GS. Very happy I decided to stay invested after the tender offer, after hanging on through the doldrums of 2022-2023.
It seems to me, though, that the share price ought to have bounced even more. Up 11p today, which is roughly the amount of the special dividend - apparently set at the level of the gain after tax.
But there is also upside from converting an investment valued by the market at a 25% discount into a loan note earning 10% interest. Close to cash, if not better - although it will be reinvested. But given the recent track record, people should be begging GS to invest more money in these PE shops... |
Another sale and another special divi. The 2024 return and share price action has been excellent - can it continue? |
Last year or the year before I'd swear that I was looking for around 450p. I don't know where I got that figure from though. |
Up and up and up. :)
Now we're getting close to the end of the "easy part" though - a narrowing of what was a fairly ridiculous discount - and now having to decide whether a GS-dominated business is worth remaining invested in.
Big broker upgrade from JP Morgan though. |
It's certainly fun when the market finally catches up with the value gap you'd identified months ago...
But dropping 18p on ex-dividend day on a 17.5 US cent dividend??? |
Hehehe me too! |
I have a nose bleed |
Yes, the stock market does seem to price PHLL like it owns a bunch of PE assets at inflated values - like most other PE investment trusts - and ignores the fee revenue from owning all of these PE shops.
Clarifying that - and dumping the PE assets at or above NAV - will go a long way to narrowing the discount here. (even though the employees at many of these shops probably extract a fair amount of the fee income as salary / bonus) |
 The strategy isn't complicated. PHLL invests in a number of (US) private equity firms. These firms either own their underlying companies direct (hence PHLL owns a stake, too) or they bundle their companies into funds which they sell on, and charge fees (hence PHLL gets fees, too).
The opening bit today:
Petershill Partners has completed a partial sale of its stake in AKKR, consisting of the entirety of its balance sheet investment capital in AKKR funds and a small portion of its interests in AKKR management fee earnings ("FRE") and performance related earnings ("PRE").
explains that it's keeping most of its fees part (including performance fees, which won't be small). The announcement follows by explaining that it in general wants to sell stakes and keep fees, which looks a less risky way to go on.
The FT said last week that Trump is likely to bring increased M&A into the US markets, and the leading firm in US M&A is Goldman Sachs. Given the investment strategy of PHLL, I can imagine a stream of these realisations at big uplifts, and a stream of special dividends. This is just the start!
Here's the Accel-KKR home page: |
It's above the wma 20 & 50 on daily + monthly and above the 20 on the monthly. I'm hoping this one will be good for me in 2025. |
This is turning out to be my share of 2024 |
I can't pretend to understand the inner workings of Petershill.
But the large discount seems crazy when they are able to sell holdings at a premium and make large special dividends / tender offers. Another 13p+ on its way... |
Special divi here means getting paid twice |
I would rather have had another tender offer - I tend to get much more than my official entitlement (through II) - but I can understand why two tenders in a calendar year might have been a bit much. I suppose we'll have to live with a special dividend. :) |
re another tender - agreed and it may be nearer the 250p mark |
$258 million will fund another nice little tender offer. Hopefully that's the plan, instead of reinvesting the proceeds into another asset manager. |
And we have reached the tender price. Now we can all exit at 214
I am hoping for another tender offer next year c 245 |
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