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QuotedData’s morning briefing 28 July 2021

In QuotedData’s morning briefing 28 July 2021:

  • Literacy Capital (BOOK) has acquired a majority stake in OFJ Spring Topco Limited, the holding company for Oxygen Freejumping, which is an operator of trampoline and adventure parks in the UK, with four sites in England. The investment will provide Oxygen Freejumping with fresh capital enabling the business to enhance its offering across existing sites, improve customer experience and engagement and to expand across the UK organically and by acquisition. The transaction represents Literacy Capital’s seventeenth platform investment completed since the inception of the fund in September 2017, and its first since it was listed on the London Stock Exchange last month.

  • Aberforth Smaller Companies (ASL) has posted its half-year results for the six months to 30 June, during which time its NAV return was 33.5%, well ahead of its Numis Smaller Companies Index benchmark, which was up 17.4% over the same period. The discount of the share price to the net asset value expanded from 3.4% to 9.8%, causing the share price return to be slightly subdued in comparison, yet still ahead of the benchmark at 24.9%. ASL’s income statement has improved significantly as more holdings than expected have resumed dividend payments, meaning the board has announced an interim dividend of 10.95p per ordinary share for the period, which is 5.3% higher than the corresponding payment last year. While the recovery appears well under way, the managers feel that pre-pandemic levels of dividends for investee companies are unlikely to be surpassed till 2023.

  • Digital 9 Infrastructure (DGI9) has entered into definitive agreements to deploy over £50m into the development of a new intercontinental fibre system. The investment will be over a three-year period into an innovative, carrier-neutral network platform between Europe, the Middle-East and India comprising subsea and terrestrial fibre assets which will connect key locations in these regions. Aqua Comms, the subsea fibre operating business acquired by DGI9 following its IPO in March 2021, will market and operate this route under the name Europe Middle-East India Connect 1 (EMIC-1). Following completion of the new system, the Company will have an interest in approximately 30,000km of subsea and related terrestrial fibre networks, connecting four continents. Thor Johnsen, head of digital infrastructure at Triple Point, said: “This investment reaffirms D9’s guiding principle: to improve digital infrastructure globally and reduce the digital divide. We continue to make progress on the company’s wider pipeline of investment opportunities and we look forward to providing further updates to the market on these in due course. In addition, we expect this innovative network to unlock further digital infrastructure opportunities.”

  • Tufton Oceanic Assets (SHIP) has agreed to acquire an Ultramax Bulker, Idaho, for $21.4m. The fuel efficient vessel is being acquired at below depreciated replacement cost (DRC) and with the proceeds of the sale of the Containership Kale announced in early July. It has a fixed rate time charter for fifteen to nineteen months producing an annual net yield (after fees and capex accrual) of approximately 21%. The bunker will be fitted with energy saving devices in October. Meanwhile, SHIP has also agreed to divest the Containership Citra for $33m. While the company aims to hold its investments over the longer term, the manager will seek to realise investments where additional value can be generated for shareholders. Citra was acquired for 75% of DRC in 2018 and is being divested at over 170% of DRC. Finally, the Bulker Laurel, which SHIP agreed to acquire in May and which is already fuel efficient versus its peer group, will be fitted with energy saving devices in August. ESDs will increasingly be fitted on the company’s vessels in 2022. These transactions, together with the divestments announced in May and early July, demonstrate the company’s commitment to ESG and capital re-allocation.

  • Jupiter Emerging & Frontier Income (JEFI) says that its fund manager, Ross Teverson, has recently increased his personal shareholding in the company to 960,000 ordinary shares, representing 1.61% of the total voting rights. [It is always encouraging to see a manager backing their judgement with their own money.]

In other news, the Association of Investment Companies (AIC) has appointed Richard Stone as its new chief executive, effective from September 2021, and HydrogenOne Capital Growth has launched but failed to meet its £250m IPO target.

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