We look to participate in undervalued public companies, serving as a partner to management and holding a long-term view.
Our focus is to apply a “hands-on approach” to each investment and unlock the intrinsic value of the business. In order to do that, we apply a proprietary approach to sourcing together with a rigorous due diligence. After we invest, we try to leverage our industry analysis and analytical capabilities in order to identify and source investment proposals, improve corporate governance, bring in new ideas, and develop a close relationship with management and the members of the Board.
We enjoy significant flexibility in the sectors in which we invest, excluding only companies in those sectors that do not match our ESG criteria, companies with a majority representation from the local Government, and international corporations with a significant presence in countries with a less than average development of human rights. We also favor B2C business models and companies in sectors involved in industry consolidation.
Our focus is to maximize the returns on cash flows by analyzing the overall corporate balance sheet and if necessary, proposing capital developments such as: new investments, acquisitions, special dividends, recapitalizations, going-private transactions, sale repurchases and securitization transactions.
Candidates for investment must be strong businesses that are trading at a significant discount to intrinsic value. They must benefit from favorable industry dynamics and possess recurring free cash flow business models. We prefer well-managed companies and we actively suggest changes in the corporate organizations when we perceive that the existing management is not optimizing the shareholders’ returns.
When deciding on a candidate to invest in, we assess the economic external and internal conditions that determine the stock price, such as size of the market, supply and demand and overall state of the economy. We also look at the structure of the balance sheet, the financial health of the company and the specific prospects of the industry. Consequently, we do not take into consideration technical analysis, analyze the past price action or derive a predictive model for the future.