Performance – April 2024

SSI tracking portfolio was down -1% in April 2024. A detailed performance breakdown is provided below.

Below you will find a more detailed breakdown of tracking portfolio returns by individual names as well as elaborations on names exited during the month.

 

TRACKING PORTFOLIO -1% IN APRIL

Disclaimer: These are not actual trading results. Tracking Portfolio is only an information tool to indicate the aggregate performance of special situation investments published on this website. See full disclaimer here.

The chart below depicts the returns of SSI Tracking Portfolio since the start of 2017.

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PERFORMANCE SPLIT APRIL 2024

The graph below details the individual MoM performance of all SSI Portfolio ideas that were active during the month of March 2024.

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PORTFOLIO IDEAS CLOSED IN APRIL
Liberty TripAdvisor (LTRPA) +24% in 1.5 Months
The LTRPA/TRIP arbitrage worked out for the fourth time in a row. LTRPA is a tracking stock for Liberty’s 29.2 million shares in TripAdvisor, with 21% economic value and 56% voting power in TRIP. Over the past two years, LTRPA traded most of the time at or above its NAV, but recently, TRIP’s price shot up, resulting in a substantial widening of LTRPA’s discount to NAV. Although it’s not uncommon for tracking stocks to trade at a discount to their intrinsic value, with LTRPA, large discounts have usually not persisted for long and quickly returned to the mean. The latest setup had some additional peculiarities and was more than a simple play on discount mean-reversion. Reportedly, TRIP/LTRPA were in talks with potential buyers, with rumors suggesting that Apollo was amongst the interested parties. In the company sale scenario, the tracking stock structure would have collapsed, and the discount would have been eliminated. However, yet again, a specific catalyst was not necessary – with a sell-off in TRIP stock, the discount approached its fair value and situation was closed with 24% gain in 1.5 months.

Ocean Wilson (OCN.L) +44% in 7 Months
Ocean Wilson, a London-listed holding company, traded at a 58% discount to NAV. In the summer of 2023, the company received a bid and initiated a strategic review for its key asset, a 57% stake in Brazil-listed port towage operator Wilson Sons (PORT3). The other asset is a semi-liquid portfolio of investments in various private equity and hedge funds. I believed the discount to NAV was too wide and that the sale of PORT3 would help to narrow the gap. Over the last several months, management reaffirmed that the strategic review was still ongoing and that the company received several indicative non-binding offers for its stake in PORT3. As a result of this and the continued strong performance of PORT3’s stock, the discount to NAV gradually narrowed from 58% to 44%, which is in line to the discount at which OCN’s parent HAN.L was trading (with a similar investment portfolio except for the Brazilian port assets). I have closed the position as even after the successful sale of PORT3 assets, the discount to NAV is likely to remain around the current levels (in line with that of the parent) barring any further steps from OCN.

 

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