Very brief post on this.
Back in December 2014 some of you may have invested in Renn Universal Growth.
It was a liquidating investment trust worth £2.95 with an offer price of £2.24 and £1.68 in liquid assets. Post on it is here.
It delisted in December 2014 promising to liquidate and pay out. I got £1.27 from the listed stocks / cash by January 2016 and have just received £1.93 per share. This gives a return thus far of 320p or 43%. Dont think there is any more to come here.
Anchor Free was sold in May 2018 according to this report from the liquidator but warranties meant that money couldnt be returned before now, some run to 2023. I have no idea how common these are. It seems a while, and I suspect the liquidators are being conservative, whilst co-incidentally earning fees as they wait…
The only problem is the timescale – doubling my money on my remaining cash (if we exclude what was paid back by January 2016) over 6 years gives a CAGR of 12%. This is better than the FTSE AS TR which is up about 26%, but far worse than my general performance over the period – up 200%. I wasn’t aware of the sale / confident of money being returned so couldnt lever on this, safe in the knowledge I would be getting my share.
So… what’s the conclusion? I am not sure I can make one as this is only one investment. It’s been an interesting experience for me – as I have never held an unlisted company in formal liquidation this long. In a booming tech bull market I am surprised Anchor free, maker of the VPN software Hotspot shield hasn’t done better. It appears other companies have over taken them or private market valuations in this space are below public ones. It may also show that near-commoditised IT businesses are not a good place to be, even if they have established a leading position.
If you hold this and havent been credited the money you might want to chase it up with your broker.
As ever, views appreciated – any similar experiences out there?
Deep Value Investments Blog 
Reps & warranties insurance is becoming more common (especially in US and UK), so if the risk is insurable you could get your cash back sooner (minus the premium) as mentioned in the kpmg report.
I personally would steer clear of commoditized tech, but that’s my personal opinion.
Apparently the liquidator tried to get reps & warranties insurance but couldnt.
It wasn’t so obvious this tech would become commoditized at the time, but I’d agree with you on this.
Hi,
I think there could be an interesting outcome from Dolphin Capital Investors in the next year or so. It seems to have bottomed out and been forgotten. NAV of 17p (but falling?). Commitment to divestment strategy, impressive list of substantial shareholders (Peter Gyllenhammer a recent buyer – of 7%). Pandemic can’t be helping. Still, it looks like there’s a margin of safety? Chairman Andrew Coppel experienced with troubled situations.
Yes, only problem is the management who are not trusted, to put it mildly. I have been waiting on DCI to turn round for far too long now.