Evan Vanderveer is a co-founder and managing partner of Vanshap Capital, a deep value, globally oriented investment management firm, minority owned by Markel Corporation. Vanshap employs a research-intensive process to identify businesses run by disciplined management teams trading at low multiples of tangible book value or cash earnings. Vanshap Capital’s Evan Vanderveer spoke today at the Capitalize For Kids Conference in Toronto and presented his favorite idea. Below are some (very) informal notes from Vanshap pitches Keck Seng Investments Ltd (HKG:0184) and Fleetwood Corporation Limited (ASX:FWD).
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Vanshap Capital
$45m AUM
focused, global deep value investing
Vanshap Capital on Keck Seng Investments Ltd (HKG:0184)
300m USD market cap
Real estate company
North America
Own the W hotel in san francisco
Buying the Sofitel hotel in New York
Owns 7 different residental and 3 commercial buildings in Macau
Own other properties in the world
Low levered world class real estate company
Trades at 72% of tangible book, 10% fcf
Currently trading at 32% of estimated NAV
Potetnetial cataylsts
Putting the W into a REIT
Continue to sell Macau real estated
Capital back to shareholders
Very large insider ownership, makes it an illiquid stock
Bought the W in san fran for a 15% cap rate (crazy good deal)
Paying a 5% cap rate currently to buy the Hotel Sofitel for 2.1b HK$
FCF per share has doubles since 2011
Stable assets
May increase dividend
Even if they decrease the valued of the assts by 40%, you get a double from the current stock price
Vanshap Capital on Fleetwood Corporation Limited (ASX:FWD)
Australian
Manufactured Accomodation — Resource Sector, Subsidized Housing, Education
Recreational Vehicles — Camec, Coromal/WIndsor are the brand names
Trading at 70% of tangbile book value and 8x fy2015 estimated earnings
Significant underlying earnings power
50% of the net debt is associated with the govt backed cash flow stream from Osprey (subsidized housing)
Net debt to ebitda is 2-3x
EBIT has come way down
Camec has been hurt by foreign price competition, and have restructured Coromal/windsor
With restructuring and some recovery, they can get back to .45 cents of earnings, should be priced at 10x earnings or $4.50 a share (currently trading at 2.75)
Michael Thompson
Michael Thompson is the Portfolio Manager for the investment vehicles managed by BHR, which he co-founded in 2009. Mr. Thompson is responsible for all portfolio construction, security selection and risk management activities and oversees BHR’s investment team. Prior to founding BHR, Mr. Thompson was with Bay Harbour Management, L.C., having joined the firm in 2008 to lead research and investment efforts in the financial and real estate sectors, including the firm’s short book, and became the portfolio manager in January 2009. Michael Thompson of Michael Thompson of BHR Capital long on Golar LNG Limited (NASDAQ:GLNG)
Michael Thompson of BHR Capital pitching Golar LNG Limited (NASDAQ:GLNG)
Businesses
Upstream, midstream and downstream
Management used to run Seadrill and made lots of money for shareholders there
Legacy Golar business (base case) is worth $30 (probably more)
The MLP (FLNG) is where the real upside rests
FLNG #1 $20
FLNG#2 $5
FLNG#3 $0
*based on current share price
It is currently valued at current spot day rates, assumes no growth in the legacy business, no benefit from existing MLP
He thinks it could be worth $90
If all 3 vessels were contracted out
GLNG has been hammered in last couple months
Due to:
Hedge fund liquidation
Poor technicals
Considered highly correlated to oil
Concerns on US shale (mainly do business overseas)
If all three vessels are contracted out, he thinks GLNG should be priced at $115
Doesn’t see much downside
