Investment Criteria

We intend to identify and merge with a sizeable profitable business with operational improvement potential at an undervalued price, aiming to generate significant returns for shareholders after the capitalization and normalization of the operation. The current crisis has created many attractive opportunities to acquire well positioned companies at below long-term average valuations due to some complex and/or special situations, such as overleveraged businesses, out of the money private equity investments and carve-outs:

Over Leveraged Companies

Certain companies are struggling with debt covenants and facing liquidity issues. In these situations, we believe that a capital increase and potential equity upside for debt holders and shareholders in a new publicly held entity, could lead to a successful financial restructuring and strengthening of the target company’s balance sheet allowing for an attractive upside for the key stakeholders

Out of the Money Private Equity Investments

The valuations of transactions consummated in 2019 were at all-time highs driven by dry powder in hands of private equity firms, debt availability and a crowded marketplace. We believe that quite a number of private equity backed companies will be up for sale at attractive valuations to facilitate a partial liquidity event for the financial sponsors

Carve-outs

The current crisis has sharply increased the already high level of corporate indebtedness. Large corporates will be willing or forced to sell their non-core divisions to generate liquidity. We believe there is an opportunity to acquire profitable divisions from large corporations and realize their standalone business potential