Riverstone Credit Opport... Share Discussion Threads

[2wild] 28/9/2024 09:58

24 September Update
RCOI is pleased to announce the successful realisation of its sustainability-linked, first lien term loan in Blackbuck Resources at 17.3% gross IRR and 13.2% net IRR.

Following this Realisation the portfolio is comprised of seven remaining positions with an average remaining duration of 1.4 years. Furthermore, the Company has an estimated unencumbered cash and cash equivalents position of approximately $9.3 million, being 13.6c per share.

[apollocreed1] 22/7/2024 16:25

RCOI didn't actually have any defaults when they were lending to oil companies. Only when they moved into ESG/renewables did they mess up.

[apollocreed1] 22/7/2024 16:23

@CC2014 - Agreed.
There was a belief during the ZIRP era that lending to renewable companies was similar in risk-profile to lending to governments because the government at one time subsidised renewable firms.
I think these types of loans are more similar to junk bonds. The borrowers are small companies with short histories and volatile earnings.

[cc2014] 22/7/2024 13:36

Thank you for post apollocreed.

I have this fund in a monitor, more to keep and eye on it and for reference to it's peer group than for anything else.

I cannot help but agree with your view over the risks in some of these debt funds. I've never owned this one but in the ZIRP era I owned others like it but slightly less risky. The era of cheap money went away and to coin a very strange metaphor, "the chickens were coming home to roost for the zombie companies"

From where I'm sitting they are all mispriced as investors continue to ignore the risks.

[apollocreed1] 22/7/2024 12:14

20% write-off today of their loan to Harland and Wolff.

There you go! Proof again that debt funds like this and Sequoia are high risk. Not worth the big risk of losing capital for a slightly higher return when you can buy government bonds. I've lost a lot on these very disappointing investments. But RCOI were particularly negligent to sink such a high proportion of their entire fund into one high risk company.

[masurenguy] 16/11/2022 15:54

Hi Rambutan2 - you seem to be ploughing a lonely furrow here. This was brought to my attention by a brief mention in last weeks issue of MoneyWeek below. It looks interesting especially since I'm already invested in a couple of renewable energy shares and also in Polar Capital. Since they are listed on the LSE, why are their shares priced and traded in $US? I'm also unable to get an online quote from my broker so how have you made an investment here?

"Riverstone Credit Opportunities (LSE: RCOI), lends to a range of borrowers in the energy market, increasingly in clean energy. The managers behind the fund have a great record and many of the loans in the portfolio have been refinanced or repaid, frequently triggering early repayment fees. Riverstone is trading at a 24% discount to NAV with a 9% yield"

[rambutan2] 27/10/2022 20:46

Doing a solid job:

As of 30 September 2022, the unaudited net asset value per Ordinary Share, including net revenue for the quarter ended 30 September, was $1.10 ($1.02: 30 June 2022) an uplift of 7%.

[rambutan2] 08/7/2021 21:17

All the transactions in posts 7 and 8 took place at between $0.85-$0.86

[rambutan2] 08/7/2021 21:06

And interestingly, Polar Capital has taken a 5.4% stake from Weiss (an arb) who have reduced to 6.4%.

[rambutan2] 08/7/2021 21:04

Re post 4, it would appear that the shares went to which now holds 8.7%.

[rambutan2] 08/7/2021 20:54

Gone green(er) - its first sustainability-linked loan:

London, UK 2 July 2021: Riverstone Credit Opportunities Income Plc ("RCOI" or the "Company") has announced it has originated one new investment:

-- Blackbuck Resources LLC - RCOI participated in a $50.0 million first lien delayed-draw term loan to a sponsor-backed water infrastructure company focused on providing E&P operators with a one-stop shop for all things related to water management, including treatment, gathering, recycling, storage and disposal. At closing on 30 June 2021, $9.9 million was committed by RCOI and $8.9 million was drawn at closing.

The first lien term loan has a maturity of June 2024 and an estimated all-in yield to maturity of 11.9 percent for RCOI on a fully-drawn basis. The term loan is RCP's first sustainability-linked loan, whereby the loan pricing steps up if certain sustainability targets are not achieved. RCP intends to use similar lending structures for conventional energy infrastructure and infrastructure services companies going forward. More information on sustainability-linked loans can be found in the link below:

[rambutan2] 08/7/2021 20:50

Now out of E&P:

London, UK 28 June 2021: Riverstone Credit Opportunities Income Plc ("RCOI" or the "Company") has announced it has fully realised an investment:

Realisations

-- Project Chase Realisation - In July 2019, RCOI committed $12.3 million to a sponsor-backed E&P company with operations focused in the dry gas window of the Eagle Ford Basin. 30% of the loan was paid down in April 2021, and on 25 June 2021, the remainder was fully realised. This resulted in 19.8 percent realised IRR and 1.22x realised MOIC.

Our go-forward strategy is to focus on infrastructure, infrastructure services as well as energy transition assets. Following the Project Chase realisation and the Project Alp realisation that closed on 21 June 2021, RCOI will have no E&P exposure.

[rambutan2] 10/6/2021 20:16

So that's 6.9m shares gone into new hands, although nothing showing (as yet) on the advfn trades over the last week. And a decent realisation:

Riverstone Credit Opportunities Income Plc
Portfolio Update

London, UK 10 June 2021: Riverstone Credit Opportunities Income Plc ("RCOI" or the "Company") has announced it has the below update and has additionally realised one investment:

Riverstone-related Shareholdings' Update

Riverstone Credit Opportunities Income Plc ("RCOI" or the "Company") has been notified that Pierre F. Lapeyre, Jr. sold 2,597,680 ordinary shares, David M. Leuschen sold 2,576,669 ordinary shares, and Riverstone Holdings LLC sold 1,711,132 ordinary shares in the Company. These shares are part of the significant investment made by Riverstone at the time of the IPO and the sales were made in response to increased investor demand, facilitating the company's planned strategy to increase shares available to third party investors . Christopher Abbate and Jamie Brodsky, the key principals at Riverstone Credit Partners, still own all of their ordinary shares and collectively the credit team owns 2,353,900 ordinary shares or 2.6% of the shares outstanding.

Realisation

-- Project Alp Realisation - In June 2019, RCOI committed $13.3 million to a sponsor-backed E&P company with operations focused in the Northern Delaware Basin of New Mexico. In December 2020, RCOI sold 40% of the loan to a third-party, and subsequently, RCOI entered a contract with a trade date of 19 May 2021 to sell the remainder of the loan to a separate third-party. The sale is expected to close the middle of June, resulting in approximately a 19.7% realised IRR and approximately a 1.21x realised MOIC.

[rambutan2] 10/6/2021 20:10

20 May 2021

Riverstone Credit Opportunities Income Plc
Interim Management Statement

London, UK 20 May 2021: Riverstone Credit Opportunities Income Plc ("RCOI" or the "Company") is issuing this Interim Management Statement ("IMS") for the period from 01 January 2021 to 31 March 2021 (the "Period").

Summary Performance

31 March 2021

Key Financials


NAV $95.56 million
NAV per share $1.04
Market capitalisation $80.56 million
Share Price $0.88
Total comprehensive income for the period $1.86 million

Quarterly Distribution

-- Riverstone Credit Opportunities Income Plc ("RCOI" or the "Company") is pleased to announce that the distribution for the period ending 31 March 2021 of 1.7 cents per share, has been declared by the Directors, payable on 25 June 2021 to holders of ordinary shares on the register at the close of business on 28 May 2021 (ex-distribution date is 27 May 2021).

-- The Company's quarterly factsheet...

[rambutan2] 18/5/2021 03:36

"...Bloomberg has identified 6 key energy transition sectors and RCOI is actively pursuing opportunities across the entire energy transition landscape. These include renewable energy, energy storage, carbon capture and storage (“CCS”), electrified transport, electrified heat, and hydrogen."

[rambutan2] 18/5/2021 03:15

The Company lends to companies working to drive change and deliver solutions across the energy sector, spanning renewable as well as conventional sources, with a primary focus on infrastructure assets. The Company’s aim is to build a portfolio that generates an attractive and consistent risk-adjusted return for investors, as well as drive positive action with regard to climate change by structuring loans as Green Loans or Sustainability-Linked Loans.

RCOI pays dividends quarterly in April, July, October and January. It has an 8–10% target annualised yield based on its $1.00 per share initial public offering (IPO) price.

The first continuation vote for the Company will be proposed at the AGM of the Company to be held in 2027, on the eighth anniversary of admission. (see also pg59-61 of prospectus)

No base management fee charged. A performance fee will be charged quarterly if return hurdles are achieved, with an annual reconciliation. There are 3 tiers of fees: 0% if distributable income is < 4%; 20% if distributable income is between 4-8% and 30% if distributable income is > 8%.The profit share is payable quarterly with an annual reconciliation in the last quarter of the year. The annual profit share payable is subject to a cap of 5% of net asset value and a potential adjustment in the event the Company suffers a capital loss. There is no catch up.

On December 7, 2022, the Company’s SPVs entered a senior secured RCF agreement for $15.0 million to enter into new commitments ahead of anticipated realisations, enabling the Company to minimise the drag on returns of uninvested capital. Pursuant to the RCF agreement, the interest rate per annum on each borrowing under the RCF can be referenced to SOFR + 6.50% with a 100bps SOFR floor.

Interview with the managers from May 2021:


Research notes (paid for):


E-mail: [e-mail]