Equus Announces Second Quarter Net Asset Value
August 13 2010 - 5:09PM
Business Wire
Equus Total Return, Inc. (NYSE: EQS) (the “Fund” or
“Equus”) reports net assets as of June 30, 2010, of $37.9 million,
a decrease of $12.3 million since March 31, 2010. Net assets per
share declined to $4.28 as of June 30, 2010 from $5.66 as of March
31, 2010. Comparative data is summarized below (in thousands,
except per share amounts):
For the Quarter Ended
6/30/2010
3/31/2010 12/31/2009
9/30/2009
6/30/2009 Net assets $37,888 $50,151
$50,901 $65,632 $72,997
Shares outstanding 8,862 8,862 8,862 8,862 8,862 Net assets per
share $4.28 $5.66 $5.74 $7.41 $8.24
Although the fair value of the Fund’s holdings in The Bradshaw
Group, Inc., PalletOne, Inc., and certain warrant holdings in
Trulite, Inc. increased during the second quarter 2010, the overall
decline in net asset value resulted principally from the decrease
in the fair values of the following portfolio holdings:
- 1848 Capital Partners, LLC
(“1848”). The Fund wrote down the fair value of its loan to
1848 from $3.7 million to $1.3 million due to a decrease in results
from operations and the value reflects the estimated net
liquidation value of certain of 1848’s assets and holdings.
- ConGlobal Industries Holding,
Inc. (“ConGlobal”). The Fund wrote down the fair value of its
holding in ConGlobal from $8.2 million to $7.3 million due to a
decrease in trailing 12 month operating results.
- Equus Media Development
Company, LLC (“EMDC”). The Fund received a repayment of capital
of $1 million from EMDC on June 24, 2010. The Fund also wrote down
the fair value of its holding in EMDC from $4.0 million ($5 million
in the prior quarter) to $1.7 million. The value of individual
properties held by EMDC, a wholly-owned subsidiary of the Fund, has
been discounted to reflect the current status and holding period of
these properties which, in some cases, exceeds three years.
- Infinia Corporation
(“Infinia”). The Fund wrote down the fair value of its holding
in Infinia from $0.7 million to $0 due to decreased operating
results and liquidity of the company which has not yet fully
commercialized its stirling engine solar thermal power generator
product.
- London Bridge Entertainment
Partners Ltd. (“London Bridge”). The Fund wrote down the fair
value of its loan to London Bridge from $2.8 million to $0.3
million due to decreased operating results and working capital
constraints. The value reflects the estimated net liquidation value
of certain of London Bridge’s assets.
- Riptide Entertainment, LLC
(“Riptide”). The Fund wrote down the fair value of its holdings
in Riptide from $3.0 million to $0.2 million due to the
underperformance of Riptide’s holdings in various entertainment
properties, including its equity holding in London Bridge.
Other significant events for the quarter were as follows:
- Proxy Contest. The Fund’s
2010 nominated slate of directors was contested, involving the Fund
in a protracted proxy battle. The Fund incurred costs of
approximately $0.9 million with respect to the contest.
- Board of Directors
Changes. On May 12, 2010, Equus shareholders elected four new
members to the Fund’s board of directors, each of whom had no prior
connection with the Fund. These four new individuals have sound
finance and investment management backgrounds, execution and
management expertise, access to deal flow across diverse industries
around the world, and strength in global capital markets. Summary
biographies of the Fund’s board of directors, including these newly
elected directors, can be viewed at the Fund’s website at
www.equuscap.com.
- Leadership Changes. On
June 8, 2010, the Fund announced the appointment of John A. Hardy
as its Executive Chairman, Robert L. Knauss as Non-Executive
Chairman, and Fraser Atkinson as Chairman of the Fund’s audit
committee. Mr. Hardy has had extensive experience in the insurance,
finance and banking sectors, as well as international mergers and
acquisitions. Mr. Knauss has significant public company and
corporate governance experience covering the past 20 years, and was
also the former Dean of the University of Houston and Vanderbilt
law schools. Mr. Atkinson was a partner at KPMG, LLP for over 14
years, having left the firm in 2002 and was involved in both the
technology and corporate finance sectors. Throughout his career he
advised companies on over 300 financings.
- Collection from Trulite.
On June 30, 2010, the Fund announced that it had received $2.6
million in cash from Trulite, Inc. (“Trulite”) as full payment of
principal interest and collection costs owed pursuant to a
promissory note issued by Trulite to the Fund in the principal
amount of $2.3 million. The Fund retains certain warrants to
acquire shares of Trulite stock that it received in connection with
its initial investment in Trulite.
About Equus
The Fund is a business development company that trades as a
closed-end fund on the New York Stock Exchange, under the symbol
"EQS". Additional information on the Fund may be obtained from the
Fund’s website.
This press release may contain certain forward-looking
statements regarding future circumstances. These forward-looking
statements are based upon the Fund’s current expectations and
assumptions and are subject to various risks and uncertainties that
could cause actual results to differ materially from those
contemplated in such forward-looking statements including, in
particular, the risks and uncertainties described in the Fund’s
filings with the SEC. Actual results, events, and performance may
differ. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as to the date hereof.
The Fund undertakes no obligation to release publicly any revisions
to these forward-looking statements that may be made to reflect
events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events. The inclusion of any statement
in this release does not constitute an admission by the Fund or any
other person that the events or circumstances described in such
statements are material.
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