WESP:ISD - Western Selection PLC

[matjone]

Western mainly consists of investments and few liabilities and is trading a little under 2/3 BV, and maybe a little better if you figure in the appreciation in some of their holdings since the report was made.

 

Prior to this year they invested their assets according to a "twin track approach of a mix of strategic stakes in smaller quoted companies with whom we have directors in common and a general portfolio of investments."  Now they are pursuing a new strategy of taking positions in pre-ipo or ipo stage companies. 

 

In their Jun 30 report they stated they've discontinued the general portfolio.  For the core portfolio they list the following holdings:

 

3 m shares Creston PLC carried at 3.15 m, last price 110 pence

1.875 m shrs Northbridge PLC carried at 9.75 m, last price 572 pence

1,869,149 shrs Swallowfield PLC carried at 1.813 m, last price 98 pence

 

49.5% of Hartim.  Hartim earned 434k before exceptional items for the period ended Jun 30.  Western is carrying this one at 568k.  They also made a half million pound loan to Hartim which converts to shares if Hartim can't pay.  I am not sure if that is included in the carrying value or what their new ownership % would be if the conversion happens.

 

29.9% of Industrial & Commercial Holdings PLC.  They own land near a golf course outside Glasgow which they think is good for a residential development.

 

48.6% of City Group PLC.  Performs office/secretarial work for them and London Finance as well as other companies.

 

 

I am not sure how I feel about the new strategy but the discount to BV is enticing.  Another alternative is to buy London Finance.  They own 43.4% of Western Selection and also a large stake in Finsbury foods, and they are also trading at a decent discount to BV.  I thought maybe this was more attractive because it diversified your exposure more.  I am a little worried about the large amount Western has allocated to Northbridge.

 

I haven't bought any yet, just thought it was interesting and wondered if anyone had looked into it.