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Crystal Amber managers snap up shares as discount widens

15 May 2018

Activist fund managers of AIM-listed Crystal Amber have purchased £150,000 of shares in the UK smaller companies investment trust after a widening in its discount.

The activist fund managers of AIM-listed Crystal Amber (CRS) have purchased £150,000 of shares in the UK smaller companies investment trust after a widening in their discount to net asset value (NAV).

An announcement to the stock exchange shows Crystal Amber Asset Management purchased 75,000 at £2 each on 11 May. Final results posted in September showed the managers owned just under 4 million shares representing a 4.05% stake in the trust.

This is separate from the share buyback scheme the £213 million trust has in place. Since the company’s interim results in March, the fund has repurchased 275,000 shares for an average price of 195.7p and a total of £539,750.

The company, whose main shareholders include fund managers Mark Barnett and Neil Woodford, has been clear about its plans to try and maintain a low discount. In the interim results, chairman Christopher Waldron, who also chairs the under-fire Rangere Direct Lending (RDL), said the share buyback programme has ‘continued and contributed to maintaining a low average discount to net asset value (NAV) of 1.8% over the [six months to 31 December]’.

However, that discount has widened this year to its current position of 8.5%, above its average for the past six months of 2.1%, according to Numis Securities data. Part of the problem could be the 6.7% fall in the NAV witnessed in the half-year results despite a successful partial exit from marinas company Sutton Harbour (SUH) that earned it £900,000.

It also saw positive contributions from online currency business FairFX (FFX), and cyber security firm NCC (NCC).

However, the trust said it was still working with Hurricane Energy (HUR) to appoint a ‘credible chairman’ following problems with the oil explorer that operates in the seas west of the Shetland Isles. Crystal Amber saw a slump in its share price after Hurricane, its largest holding, ran into problems.

Hurricane’s share price nearly halved within two months on the back of what the trust said at the time was ‘poor handling’ of a warrant issue and comments by the oil explorer’s management team about funding and delivering an ‘early production system’.

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