market folly

We're posting up notes from the 2017 London Value Investor Conference.  Next up is Joe Bauernfreund of Asset Value Investors who pitched Wendel SE (EPA:MF) and mentioned a few other investment ideas.


Joe Bauernfreund's Presentation at London Value Investor Conference

Asset Value Investors specialise in investing in companies trading at below realisable book value. They do not look at recorded book values or NAVs but instead do the work themselves. They can only achieve accurate valuations in companies that are open, transparent with managements that are prepared to talk to them.

Long: Wendel SE (EPA: MF)

Wendel is listed in France and is primarily engaged in owning assets or securities of other companies. It’s a family run business (36.4%) with a long-term focus. The management have proved themselves to be good capital allocators but they did buy St Gobain in 2007 which turned out to be awful timing. They are now reducing the stake in St Gobain and paying down debt. Despite the St Gobain purchase Wendel has handily beaten the MSCI Europe return since 2005: 9.1% Vs 5.5%

Wendel owns 12 businesses. The unlisted part of the portfolio has the most potential to act as a catalyst. It has 4 assets all of which have been identified for IPO by the end of 2018. The IPOs could add 8% to NAV. Bauernfreund estimates that Wendel is already trading at a 29% discount to NAV.
AVI own 1.3% of Wendel’s outstanding shares.

He also mentioned 3 other investment ideas. Long Hudson Bay (TSE: HBC), Long Symphony International (LON: SIHL) and Long Toshiba Plant (TYO: 1983).


Be sure to check out the rest of the presentations from the London Value Investor Conference.