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Special situation: Liquidation of KANAM Grundinvest fund (ISIN DE0006791809)

Disclaimer: This is not investment advice. PLEASE DO YOUR OWN RESEARCH !!!

Background:

This investment is not an original idea, but rather a “me too” investment. Ben from Wertart has a very good write up from November last year, so I spare myself to go into too much historic description.

Just the short version: Kanam Grundinvest is one of several formerly open real estate funds in Germany which have been put into liquidation. The major difference to almost all other funds is that in the Kanam case investors actually didn’t lose any money over the lifetime of the fund as the real estate seems to have been relatively high quality. As of December 31st 2016, the fund has sold 95% of its real estate and is now effectively a cash box with some remaining real estate exposure.

So let’s focus on what has changed since Ben wrote his post:

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Book review: “Great by Choice” – Jim Collins

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“Great by Choice” seems to be the most recent book (2011) from management “guru” Jim Collins. Similar to “Built to last” he focuses on companies that have achieved great success. However in “Great by Choice” he includes a certain twist: He looks at 8 pairs of competing companies which more or less had the same starting point, but where one of them became super successful and the other not.

He then tries to work out why the successful ones were successful. The pairs are as follows:

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Travel series (5): Flight Centre – “Outsider” Company or off line Dinosaur ?

This is part 2 of the Flight Centre analysis after the book review last week.

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The “old” business model

The Australian based company is a classic “travel agency”, both, running physical agencies as well as offering airline tickets and tours over web sites.

A traditional travel agency usually works like this: They offer flights from preferred airline partners and hotels or packages also mostly from certain partner companies. Traditionally you would go into a travel agency and ask if they can recommend you a destination, then you would be offered some colorful catalogues where they list the offered hotels (with prices mostly depending on the official “star system”) and then gladly sell you the “Bundle”.

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Performance review Q1 2017 – Strategy update “Money Management”

Perfomance Q1 2017:

In Q1 2017, the blog portfolio gained +9,03% (including dividends, no taxes) against 7,77% for the Benchmark (Eurostoxx50 (Perf.Ind) (25%), Eurostoxx small 200 (25%), DAX (30%), MDAX (20%)). Since inception, the score is now +156,8% vs. 74,7% for the benchmark. The full details (and graph) as always on the performance page.

Some other funds that I follow have performed as follows in Q1 2017:

Partners Fund TGV: +10,88% 
Profitlich/Schmidlin: +5,56%
Squad European Convictions +8,81%
Ennismore European Smaller Cos 2,04% (in EUR)
Frankfurter Aktienfonds für Stiftungen +5,06%
Evermore Global Value +7,03%
Greiff Special Situation +4,13%

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Topdanmark A/S – A “Cannibal” soon to be set on a dividend diet ?

Topdanmark – The Danish Cannibal

Topdanmark, a local Danish Insurance company has been on my extended “to do” list for a long time for 2 reasons: It is the second most profitable European insurance company after Admiral (based on ROE) and  as Charlie Munger would call it a “true Cannibal”.

Those are some selected numbers from Topdanmark over the last 18 years:

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Handelsbanken Update & Annual Report 2016 -(almost) on track

Already a couple of weeks ago, Handelsbanken issued their 2016 annual report. On the surface, the numbers look like a small disappointment with flat profit and a slight decrease in EPS.

Behind the surface however, some things happened. The CEO was fired in 2016 for “too much centralization”.

Some highlights of the annual report from my side:

  • the number of branches in Sweden went down from 474 to 435
  • the 4th quarter was very weak, but most likely driven by cost for branch closures in Sweden which happened in Q4. I liked this comment:

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Contingent Value Rights (CVRs) – The case of the Sanofi/Genzyme CVR

As I was trying to research a little bit how to value a pipeline of drugs still in development (Actelion spin-off), I stumbled across the so-called “Contingent Value Rights” (CVRs) which are often used in Pharma takeovers.

A CVR is somehow similar to a tracking stock with the exception that the CVR often tracks a more specific item such as a single product or in case of many Pharma M&A transactions, the outcome of a certain drug development project.

Acquirers and sellers sometimes use this instrument if they cannot agree on the value of an under development drug. The idea behind is that the seller keeps the upside and the buyer doesn’t need to pay upfront for some very risky future cashflows.

Sanofi/Genzyme Lemtrada CVR

When Sanofi took over Gynzme in 2011 such a situation crystalized. This is from a 2015 NYT story:

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