Viking International chief Andreas Holversen disclosed a stake in Mudrick Capital Acquistion Corp. II (NASDAQ:MUDS) earlier this month, seeing yet one more worth alternative in particular objective acquisition firms.
Along with contemplating cyclical and secular business developments, the guru’s Connecticut-based hedge fund selects shares primarily based on its understanding of the enterprise’ fundamentals and administration workforce. Halvorsen was a former protégé of Tiger Administration’s Julian Robertson (Trades, Portfolio).
Based on GuruFocus Real-Time Picks, a Premium characteristic, Halvorsen invested in 3.05 million shares of the SPAC on April 6, dedicating 0.10% of the fairness portfolio to the stake. The inventory traded for a mean worth of $11.50 per share on the day of the transaction.
The blank-check firm, which separated its Class A inventory and warrants as of Jan. 29 after going public on Dec. 8, 2020 below the ticker “MUDSU,” has a $475.17 million market cap; its shares have been buying and selling round $12.05 on Wednesday.
As a SPAC, Mudrick Capital acts as a shell firm that has no industrial operations however raises capital by way of a public providing to be able to purchase or merge with one other present firm that’s in search of to go public. There have been a report variety of firms who selected this route, versus a standard preliminary public providing, in 2020, and the pattern seems to be going robust this 12 months as properly.
Whereas the corporate might pursue a mixture with any enterprise or business, Mudrick famous in a submitting it supposed to concentrate on post-restructured and distressed firms. It discovered its excellent candidate in The Topps Firm Inc., which was contemplating a possible sale again in 2018.
On April 6, the 83-year-old firm headquartered in New York, which manufactures sports activities memorabilia like baseball buying and selling playing cards and different collectibles, introduced its plans to go public with Mudrick’s assist. Whereas Topps recorded a 23% improve in gross sales in 2020 to a report $567 million, it’s in search of to broaden its e-commerce and cellular purposes as a part of its digital initiatives. It is also attempting to push into the quickly rising non-fungible tokens market.
In a press release, Mudrick Capital founder and Chief Funding Officer Jason Mudrick commented on Topps’ enterprise.
“We imagine Topps’ tradition of innovation, robust administration workforce, increasing margins, strong money circulate and conservative stability sheet set it aside from different client development firms,” he mentioned. “It is also properly located with a universally acknowledged model to capitalize on the quick rising marketplace for collectible NFTs. We’re excited to associate with this distinctive group to assist write the subsequent chapter within the lengthy historical past of its actually iconic model.”
The mixed firm, which will likely be named Topps, is projected to have an enterprise worth of $1.3 billion and can commerce below the ticker “TOPP” on the Nasdaq change.
Michael Eisner, the previous chairman and CEO of The Walt Disney Co
“With the assist of our new companions at Mudrick Capital, the corporate will proceed its lengthy historical past of innovation and world enlargement, bringing customers one of the best of collectibles and confections merchandise whereas efficiently extending into new verticals and rising classes to reap the benefits of digital content material innovation and excessive development alternatives throughout the globe,” he mentioned.
Eisner will stay chairman of the corporate’s board upon the closure of the deal. His funding agency, Tornante Firm, partnered with Madison Dearborn Companions to buy Topps in 2007. A portion of the $571 million in gross proceeds that’s anticipated to be generated from the transaction will likely be used to buy shares from Madison Dearborn, which intends to promote the vast majority of its possession stake.
The deal is predicted to shut in the course of the third quarter. Topps President and CEO Michael Brandstaedter will proceed to guide the mixed firm.
“The longer term for Topps has by no means been brighter, and, with a gifted and devoted administration and worker base, we’re excited for the highway forward,” he mentioned.
Halvorsen’s $36.37 billion fairness portfolio, which was composed of 96 shares as of the tip of the fourth quarter, is basically invested within the well being care and know-how sectors.
Viking International’s 5 largest holdings as of the tip of the three months ended Dec. 31 have been Microsoft Corp. (NASDAQ:MSFT), BridgeBio Pharma Inc. (NASDAQ:BBIO), Adaptive Biotechnologies Corp. (NASDAQ:ADPT), Constancy Nationwide Data Companies Inc. (NYSE:FIS) and T-Cellular US Inc. (NASDAQ:TMUS).
In March, Viking International additionally disclosed a stake in one other SPAC, Orion Acquisition Corp. (NASDAQ:OHPAU).
Disclosure: No positions.
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