The strategic public equity investment strategy targets superior long-term investment returns by applying a private equity approach and techniques to investing in quoted companies. Strategic Public Equity is based on an approach which significantly reduces company specific risk within a focused portfolio by adopting a value investment philosophy and private equity-style techniques and due diligence, including an investment committee that draws on the expertise of a distinguished and experienced advisory group with industrial and private equity backgrounds.
We seek to provide growth and acquisition capital alongside significant block stake investments primarily in smaller public companies.
The private equity techniques applied to investing in public companies ensure a rigorous and deep understanding of each investment. This sits alongside an approach of considerably higher levels of engagement with stakeholders (management, shareholders, advisers, customers, competitors) and influence in support of a clear equity value creation plan which results in a de-risking of investment. This approach invests with a 3-5 year horizon and whilst short-term volatility exists, the risk to permanent capital should be reduced due to several factors:
- Investment philosophy (value-bias)
- Private equity style, diligence process
- Significant and constructive engagement with management and influence
- A clear equity value creation plan and identified catalysts.
Qualitative assessment matrix
The Investment Team applies a qualitative assessment matrix (quality-score) to all investment opportunities looking at:
- Market characteristics and dynamics
- Positioning within the market, ability to grow and the quality of those prospects, pricing power, client/customer quality, extent of differentiation and competitive advantage
- The strength, quality, experience and alignment of management
- Financials, focusing on issues such as customer concentration, sustainability of margins, capital intensity and cashflow characteristics, stability and predictability
- M&A dynamics and attractiveness of the company to larger trade buyers and private equity
- Our ability to acquire a stake and assist in value creation and enhancements
Please note that any returns are not guaranteed and capital is at risk. Please refer to the risk section for further information.