Michael M. Rothenberg and David Sackler’s Moab Capital Partners has disclosed a new position in Capital Southwest Corporation (NASDAQ:CSWC) and trimming its exposure to Symmetry Surgical Inc (NASDAQ:SSRG). As a filing with the Securities and Exchange Commission showed, Moab owns around 981,100 shares of Capital Southwest Corporation, the passive stake being equal to 6.31% of the company’s outstanding common stock. In a second filing, the investor reported ownership of some 815,000 shares, equal to 8.5% of the company’s common stock, down from approximately 905,200 shares held earlier. Moreover, the fund changed the nature of its stake to passive from activist.
New York City-based Moab Capital Partners was founded by two former employees of Richard Perry‘s Perry Capital. As of the end of September, the fund that follows an event-driven strategy, revealed an equity portfolio worth $268.74 million. At of the end of September, 2014, the largest equity holding in Moab’s equity portfolio was represented by Macquarie Infrastructure Company LLC (NYSE:MIC), an airport infrastructure company of which the investor held 527,200 shares. Meanwhile, as the fund was raising its exposure to the company, the stock of Macquire Infrastructure appreciated by 35% over the last 52 weeks. The fund also added Symmetry Medical Inc. (NYSE:SMA) to its equity portfolio during the third quarter of last year, and disclosed 2.81 million shares in its latest 13F filing, but the stock inched up only 1% since the fund disclosed holding shares of the company.
Moab’s latest acquisition, Capital Southwest Corporation (NASDAQ:CSWC), is a $670 million business development company, which owns a portfolio of comanies and is focused on expansion financing, management buyouts, industry consolidations and other investments. Being a part of the asset management industry, Capital Southwest Corporation’s stock appreciated by over 25% within the last 52 weeks, significantly outperforming its peers, which on average returned 6.5% during the same period. As of the end of last year, Capital Southwest Corporation (NASDAQ:CSWC) had net assets worth $733.21 million, equal to $47.17 per share, down from $767.85 million ($50.25 per share) held at the end of 2013.
Moreover, in December, the board of Capital Southwest Corporation (NASDAQ:CSWC) announced its decision to split the company into two separete businesses, one focused on industrial growth and the other one engaged in lending to strong middle-market companies. The deal is expected to be completed by the end of the third quarter of the current year. The market responded positively to the news as the stock gained around 17% since the decision was announced.
So far, with its position that contains 981,100 shares of Southwest, Moab Capital Partners is the largest shareholder among the funds that we track and one of the largest shareholders among institutional investors. The previous round of 13F filings has seen Martin Whitman’s Third Avenue Management decrease its exposure to the company by 30% to 150,300 shares, while John W. Rogers‘ Ariel Investments picked up its position by 6% on the quarter to 85,400 shares. However, in the equity portfolio of both funds, Southwest represents small portions of the total value.
