Wednesday, July 22, 2009

Catalyst Investment Research: Steel Partners Portfolio

This investment catalyst has been building since January 8 2009 when Steel Partners II first announced their intention to convert their hedge fund into a publicly-traded holding company. Following months of litigation with several investors seeking to block the restructuring, Steel was granted Court approval to move forward with the plan on June 19. As a result, on July 15, Steel Partners distributed approximately half of the economic value of their fund via cash and a pro rata in-kind distribution of securities to those investors seeking to exit the fund immediately. Following the distribution, a number of smaller, illiquid securities observed enormous selloffs – causing a massive imbalance in supply and demand, and resulting in a precipitous decline in the market value of certain companies. We believe the dramatic reduction in value at a few of these companies is a short-term phenomenon and not correlated with the fundamental value intrinsic to the company.

Click here to download a complimentary copy of Hedge Fund Solutions' Catalyst Investment Research report for Steel Partners II Portfolio.

Also, take a look at some of our previous research on companies where activist investors have made sizeable investments and are pressing management to unlock hidden pockets of value.


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