Going through some info on this company highlights two interesting details - the foundation portfolio was constructed with about $30 million from a group of investors and then add $27 million (or was it $25 million) in the IPO gives a gap of $5 million that has been added to the value for the original investors. This is of course relating to the market cap at present. Hopefully this represents real value added by the underlying businesses.
Second point, each director gets $60K and hopefully they will actually generate at least that amount of value and not shoot the breeze at board meetings. The managers don't get paid and you would think that is mighty nice of them. But mark the management fee at 1.75% of NAV which comes to over $1 million. Take away costs of office, services and one administrator for a total of, say, $200K and that leaves over $800K between the two managers - not a bad income. I would have preferred a management fee equalling cost and add a percentage of increase in NAV.
Sadly, there is not much information about what progress, both in business and finances the portfolio companies are making, so it is impossible to come to any informed opinion of the investment. Also, NAV figures may be compliant to accounting standards and audited by an 'independent' accounting firm but this may still be a will-o-the-wisp as far as real value for the investor.
These may be a few factors in why some investors have chosen to take a 10% loss and get out. Not saying this is a bad investment - just that it is not possible to say if it is good. It boils down to what you know about the managers and how much faith you have in them.
BTI Price at posting:
89.0¢ Sentiment: None Disclosure: Not Held
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