MONTCLAIR, N.J., Sept. 03, 2024 (GLOBE NEWSWIRE) -- 180 Degree Capital Corp. (“180 Degree Capital”) (NASDAQ: TURN), noted today that the average discount between its estimated daily net asset value per share (“NAV”) and its daily closing stock price during August 2024 and year-to-date through the end of August 2024, were approximately 21% and 19%, respectively.1 This discount was approximately 25% on August 30, 2024, the last day of trading in the month.
As previously disclosed in a press release on November 13, 2023, 180 Degree Capital’s Board of Directors (the “Board”) has set two measurement periods of 1) January 1, 2024 to December 31, 2024, and 2) January 1, 2025 to June 30, 2025, in which it will evaluate the average discount between TURN’s estimated daily NAV and its closing stock price pursuant to a Discount Management Program. Should TURN’s common stock trade at an average daily discount to NAV of more than 12% during either of these measurement periods, the Board will consider all available options at the end of each measurement period including, but not limited to, a significant expansion of 180 Degree Capital’s current stock buyback program of up to $5 million, cash distributions reflecting a return of capital to shareholders, or a tender offer. We currently believe that any option and amount selected by the Board will be chosen carefully to not jeopardize the long-term potential of TURN to create value by requiring the monetization of a significant portion of TURN’s portfolio at historically low stock prices.
“From conversations after we announced the Discount Management Program, we were pleased our shareholders appreciated and supported our decision to implement it,” said Kevin M. Rendino, Chief Executive Officer of 180 Degree Capital. “As I always have said, we do what we say we are going to do. On our last shareholder call, I noted that I believe our current discount to NAV is wholly inconsistent with what we believe is the potential upside within our existing portfolio as well as our actual NAV. This comment led to an outpouring of suggestions and opinions from many of our shareholders, including many of our largest and long-term investors who have been holders of TURN since Daniel and I began TURN’s transformation in 2017, if not longer. As a result of those conversations, we believe that these large and long-term investors fully appreciate our belief that our current portfolio offers significant upside potential, in part because we may be nearing the end of the bear market for small capitalization stocks. Our largest and long-term investors individually made it clear to us that they have no desire to materially trade that potential upside to chase short-term gains at this point. Based on the outreach from shareholders to us, we currently believe this opinion is shared by holders of at least a third of TURN’s outstanding stock.”
Mr. Rendino continued, “We also understand that more recent shareholders may be focused on capturing our trading discount for short-term gains through a larger tender offer or distribution, even if it means foregoing material portions of what we believe is future upside within our portfolio. We are activists and work for all shareholders. We will continue to make decisions that accrue to the benefit of all shareholders and will never sacrifice material portions of what we believe to be future potential for short-term gains. Many of our shareholders have a keen memory of the heavy lift we undertook when we took over our predecessor company that was structured as a business development company (BDC) solely focused on venture capital investments. Our first five years produced strong investment performance and a rising NAV. While historical results may not be indicative of future results, we currently believe this macro headwind of poor small cap performance versus large capitalization stocks will reverse, and we believe we are well positioned to deliver again, strong growth in NAV as we did during the first five years of TURN’s existence.”
Daniel B. Wolfe, President of 180 Degree Capital, added, “We appreciate that our largest and long-term investors remain supportive of our investment approach and share our belief that the potential future returns from our investments could lead to substantially larger growth in NAV than capturing all or a significant portion of the discount today. To be clear, the Board has not decided about ending the first measurement period early, and/or if it decides to do so, what steps might be taken amongst those mentioned previously or other available alternatives. Any decisions made will be made by the Board in the best interest of all shareholders of TURN, which is why we appreciate the thoughts and feedback Kevin mentioned above, particularly from our long-term and largest shareholders.”
About 180 Degree Capital Corp.
180 Degree Capital Corp. is a publicly traded registered closed-end fund focused on investing in and providing value-added assistance through constructive activism to what we believe are substantially undervalued small, publicly traded companies that have potential for significant turnarounds. Our goal is that the result of our constructive activism leads to a reversal in direction for the share price of these investee companies, i.e., a 180-degree turn. Detailed information about 180 and its holdings can be found on its website at www.180degreecapital.com.
Press Contact:
Daniel B. Wolfe
Robert E. Bigelow
180 Degree Capital Corp.
973-746-4500
ir@180degreecapital.com
Mo Shafroth
RF Binder
Morrison.shafroth@rfbinder.com
Forward-Looking Statements
This press release may contain statements of a forward-looking nature relating to future events. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. These statements reflect the Company's current beliefs, and a number of important factors could cause actual results to differ materially from those expressed in this press release. Please see the Company's securities filings filed with the Securities and Exchange Commission for a more detailed discussion of the risks and uncertainties associated with the Company's business and other significant factors that could affect the Company's actual results. Except as otherwise required by Federal securities laws, the Company undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties. The reference and link to the website www.180degreecapital.com has been provided as a convenience, and the information contained on such website is not incorporated by reference into this press release. 180 is not responsible for the contents of third-party websites.
1. Daily estimated NAVs used for the discount calculation outside of quarter-end dates are determined as prescribed in 180’s Valuation Procedures for Level 3 assets. Non-investment-related assets and liabilities used to determine estimated daily NAV are those reported as of the end of the prior quarter.
