Tuesday, June 26, 2007

And Then There Were Two

As in funds with problems because of the subprime market:

LONDON (Thomson Financial) - Queen's Walk Investment Ltd posted a net loss for the year ended March 31 mainly as a result of fair value adjustments made to
investments in 2007.

The group posted a net loss of 67.7 mln eur for the full year while net asset value decreased to 7.24 eur as at March 31, 2007 from 9.90 eur as at Dec 31, 2006. It had reported a net profit of 9.77 mln eur for the period from Sept 6, 2005 to March 31, 2006.

The first full-year results as a public company reflect a period of exceptional turbulence in many of the asset-backed securities markets in which the company has invested, primarily during the fourth quarter of the financial year, chairman Tom Chandos said.

The WSJ also noted this fund is a story today on Bear Stearns:

And, Queen's Walk Investment Ltd., a United Kingdom-based publicly traded closed-end fund managed by Cheyne Capital Management (U.K.) LLP, said it had a net loss of €67.7 million ($91.2 million) in the first quarter and a loss of €98.8 million in the fourth quarter, due to losses in the mortgage-backed bond market. The net asset value of the securities in the fund fell 26.8%. More broadly, bond markets show signs of trouble digesting recent issues of corporate debt.

Here's the complete story off the Dow Jones News Wire:

Monday, it said it had marked down by half the value of its U.S. assets, in the latest setback for the banks and hedge funds that had been betting on much-lower delinquency rates from U.S. home loan borrowers with poor credit histories


Stuart Fiertz, a founder of Cheyne Capital, told Dow Jones Newswires he isn't anticipating further pain in Queen's Walk's U.S. subprime portfolio, mainly because it has sold three of its four U.S. subprime mortgage positions, reducing the size of its overall portfolio to around EUR319.9 million as of May 31.

That reduced the U.S. subprime portion of its portfolio from 12% to 3%, though it still has exposure to higher-quality tranches of U.S. mortgage-backed securities.

So the company sold the non-performing assets. What price did they get? And who bought them?