Maglan Capital commentary for the month of November 2015.
Maglan Capital increased in value by 14.58% (net of all fees) during the month of November.
For 2015, Maglan Capital has increased 8.35% (net).
Jim Chanos has a new short target in his sights. Earlier this week, the hedge fund manager disclosed that he is betting against "legacy" data centers that face growing competition from the trio of technology giants, which have previously been their biggest customers. The fund manager, who is best known for his winning bet against Read More
In the most recent 3 years, Maglan Capital has averaged an annual gain of 24.31% (net).
The fund recorded solid performance in November. Much of the gain is attributable to added concentration in certain high-conviction core investments. In particular, we added to some positions that experienced an asymmetrical battering during the market’s summer pullback.
Maglan Capital – Portfolio performance
With respect to fundamental, core investment-related developments, during November, Globalstar (GSAT) received the surprise, about-face endorsement to the FCC by a respected public-interest advocate.1 This development continues to set the stage for the near-term approval of Globalstar’s NPRM (Notice for Proposed Rulemaking) concerning terrestrial low-power service (TLPS).
In connection with Madalena Energy (MVN; MDLNF), the extremely positive developments continue to stack up. In late November, Argentina concluded a historic Presidential election with Mauricio Macri as the winner. By all accounts, Macri was the candidate most likely to get Argentina’s economy back on track. The excitement in Argentina’s business community and in foreign investors looking at Argentina is palpable. Specifically, Macri is expected to reform monetary policy, correct fiscal imbalances, settle outstanding defaults, and bring the country back into the view of the worldwide banking and investment community. Moreover, Macri’s new Minister of Energy and Mines has deep industry experience and has already explicitly voiced the need for the government to continue to support energy exploration and production activities in the Vaca Muerta.2
More importantly, we are excited about the expected forthcoming near- and medium-term events associated with some of our core investments. For instance, FairPoint Communications (FRP) continues to actively seek a corporate transaction. Globalstar’s FCC approval will immediately be followed by approval efforts in other jurisdictions around the world and a focus on monetizing its valuable spectrum. And, Madalena Energy, in addition to continuing planned drilling activity, is considering financing opportunities to turbo-charge exploration and production.
Currently, Maglan’s portfolio presents an incredible value opportunity.
Furthermore, we remain open for co-investment on Madalena Energy.
Maglan Capital is an event-driven investment fund with a concentrated portfolio of investments across the capital structure of small- and mid-cap companies with core focus on financial distress, restructuring and operational turnaround.
We appreciate your support and confidence in our team.
Steven Azarbad, Chief Investment Officer and David D. Tawil, President