Daejan Holdings is a UK real estate holding I was planning to hold on to for the rest of my life.
I increased my position through the years, mostly when they were trading at around 50% of NAV. What I like about them is the fact that they are family owner-operators, with conservative financial reflexes, ideally positioned to benefit from any sort of crisis.
The controlling family are orthodox jews. Therefore they don’t allow women to sit on their board.
Now that practice has met with some criticism, they decided to take Daejan private with a buyout of 8050/share or 55% above the listed price at the moment.
Am I not pleased with this, to say the least. Actually, I am a bit enraged. 80,50 per share is well under the NAV of 120 per share. A NAV I saw growing in the foreseeable future at a nice clip of about 7 to 9% – as they did historically.
This is no way to to treat your loyal minority shareholders…
I rather see a safe 100% growth in a couple of years, then a short time 55% jump – but feeling screwed in broad daylight.
I am still hoping most of the shareholders of Daejan are sensible and refuse to pay out at these prices.
Still, I sold half of my Daejan. Why is that ?
Just when Daejan surged, another princess appeared on the horizon because of the global sellof.
Exor is a Italian family investment holding, under the guidance of John Elkann. They own automakers Fiat Group and Ferrari ; re-insurer Partner Re ; agricultural equipement maker CNH industrial, known for the brand New Holland and a few “smaller” vanity (?) projects like football club Juventus and The Economist.
Growing up as the son of a potato merchant, I know New Holland equipment all to well.
Right about now they trade under 65/share.
I reckon that is 50 cents on the dollar.
Right about now they are in talks to sell (or merge) Partner Re for above 9 billion. Fiat is merging with Peugeot and will receive a substantial dividend payment. And they will split CNH up in two parts, that should create more visibility to the underlying value.
They are also buying back shares.
As of today, back of the envelope this gives me something like this:
Although I don’t like automakers besides Ferrari (capital intensive and commodity like products), I do think Fiat is undervalued.
And I do think NAV will be higher then 130/share in the nearish future.
I even like them when a global crisis would hit us , since Elkann has proven to be a great deal maker and capital alocator.
NAV has grown at 20% per year since he took over.
I have been following Exor since it was in it 20ies per share. Been pounding myself over the head ever since. Bought some in its fifties.
Happy to buy more when a crisis hits the world and build this one into a 10% position.