Investment Matters

Company News: Acorn Capital, Cardno, Lovisa, Holdco and more

Alternatives sub-portfolio

Acorn Capital Expansion Fund (positive impact)

We were pleased to receive a notification that clients’ position in Acorn Capital expansion fund has been revalued 20% higher.

This is a result of a revaluation by Acorn of several holdings within the fund during the December quarter.

It was a busy quarter for the fund – with two companies held within the fund listing on the ASX.

Clients continue to hold an interest in both companies:

  • Cleanspace (ASX: CSX) – a company that has developed a lightweight mobile respirator for use in healthcare and other industries.
  • Cluey (ASX: CLU) – an education technology company that provides online education for students.

These listings provided an opportunity for Acorn to realise some of the underlying investments in the fund and subsequently pay a distribution of 2.3% on the capital it has deployed thus far.

Several other companies within the fund are looking to list on the exchange in 2021, which should provide an opportunity to realise any further uplift in value.

Furthermore, with a small amount of committed capital still to be deployed, the company continues to look for more opportunities to deploy funds.

It is currently reviewing four transactions we see as exciting potential additions to the portfolio.

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Holdco (Patties Foods) (mixed impact)

Recently, Patties Foods has looked to sell and leaseback two of its properties.

The company will look to sell its properties in Bairnsdale with a 30-year lease period (to Patties) for proceeds of around $130m. Proceeds from the sale and leaseback will reportedly pay for the overhaul of some of the plant at the site.

Prior to this, the company launched a small rights issue.

First Samuel clients took up their entitlement in full as part of this rights issue, which represented a nominal amount for the majority of clients (an average of $400 across client accounts).

The holding has subsequently been repriced to $0.90 in line with the price of the rights issue.

Under the majority ownership of private equity firm Pacific Equity Partners (PEP) the company continues to look to find operational improvements in working towards an eventual sale or relisting.

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The above market commentary represents the views and opinions of First Samuel Pty Ltd. Such market commentary contains information of a general nature only. Such market commentary is not intended to provide a sufficient basis on which to make any investment decision and should not be taken as such. It has not taken into consideration your objectives, needs or financial situation. Before making decisions in relation to any financial product, you should always obtain and read any relevant Product Disclosure Statement or information statement and seek personal financial advice.