As
for AREO — well, we're all guilty of excess & delusion during the boom years: Like pretty much all funds launched then, prices & potential weren't attractive enough, and leverage was far too high — a lot of those funds are now gone, but AREO still lives to fight another day.
That kind of investor response & demand is certainly somewhat unexpected, but may ultimately signal some encouraging potential / alternatives
for AREO...]
Remember: a) for Argo's own valuation I only count a $ 200 - 300 K value
for AREO equity (I ignore loans & receivables), and b) the exposure of the funds to AREO equity should now be written down to about $ 12 mio.
Not exact matches
[Which appears to provide good support
for my prior assumption that
AREO paid a total of EUR 1.2 mio in 2012].
In this case,
for a number of reasons, their treatment's clearly preferable — $ 1.3 m of
AREO revenue (which is contractually due) is recorded, but this amount's immediately written off as a bad debt provision in the P&L.
Of course, you'll note
AREO revenue is still included
for 2013 — let's revisit Note 12.
Argo's price at teh time was GBP 10.125 p & mkt cap was $ 10.9 mio — allowing
for cash of $ 5.0 mio, and Argo's $ 0.8 mio
AREO holding, this implies a ($ 5.1 mio) 30 % of NAV valuation
for TAF!
As of today, you could adjust
for small Cyprus losses & also a decline in the value of the
AREO stake (easy to calculate, the no.
With no fresh info / figures from Argo, I'll presume an unchanged value
for TAF, a decline in their
AREO stake to $ 0.4 mio & an increase in AUM to $ 313 mio.
Unless
AREO's directors believe an equity fund - raising is viable, the first step here is to de-list — a public listing's an expensive waste of time & money
for a distressed company.