2022
MARWYN VALUE INVESTORS LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2022
Annual Report and
Financial Statements
04 Financial and Performance Summary
06 Report of the Chairman
08 Report of the Manager
16 Investment Portfolio
24 Allocation of Net Asset Value
28 Environmental, Social and Governance
32 Capital Distributions, NAV and Discount Management
34 Fund Structure and Investment Policy
36 Report of the Directors
50 Report of the Independent Auditor
56 Income Statement
57 Statement of Financial Position
58 Statement of Cash Flows
59 Statement of Changes in Equity
60 Notes to the Financial Statements
74 Risk
80 Look-through Portfolio Information
82 Advisers
84 DefinedTerms
85 Disclaimer
DefinedtermsusedthroughouttheAnnualReportandFinancialStatements
are as described on page 84.
Contents
2022
MARWYN VALUE INVESTORS LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2022
Annual Report and
Financial Statements
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3
PERFORMANCE FOR YEAR TO / AS AT 31 DECEMBER 2022
Ordinary Shares
Financial and Performance Summary
NAV Total Return
1
+1.5%
Share Price Performance
2
-13.3%
NAV Per Share
176.8p
Share Price
95.0p
Dividends
9.06p
Net Assets
£98.1m
Market Capitalisation
£52.7m
Implied Dividend Yield
9.5%
Inception to date NAV Total Return
+183.0%
1
For the ordinary shares, inception to date movement is based on the combined weighted average NAV of Marwyn Value Investors I, II and
B shares prior to their amalgamation, using the conversion ratio published on 17 April 2008.
NAV total return assumes the reinvestment of dividends paid to shareholders into the Company at NAV and is calculated on a cum-income basis.
2
Share price performance assumes the reinvestment of dividends paid to shareholders into the Company at the ex-div share price
on the ex-div date.
Investments are held indirectly, as described in the Fund structure and investment policy section of this Annual Report
Look-Through NAV Breakdown as at 31 December 2022
assuming full year dividend of 9.06p and
31 December 2022 share price of 95.0p
Company % of NAV NAV/share Contribution (£)
Le Chameau 19.4% 0.34
AdvancedAdvTLimited 12.1% 0.21
Marwyn Acquisition Company II Limited 9.7% 0.17
Marwyn Acquisition Company III Limited 9.7% 0.17
450 plc 5.0% 0.09
MAC Alpha Limited 0.5% 0.01
Zegona Communications plc 0.4% 0.01
Cash 45.2% 0.80
Other assets / liabilities (2.0)% (0.03)
Net assets 100.0% 1.77
4
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Financial and Performance Summary
3
For the 2016 realisation shares and 2021 realisation shares, shareholder total return is calculated as the movement in total shareholder value,
including all distributions made to realisation shareholders over the relevant period.
4
Calculated as total distributions as a percentage of Net Assets on creation of each class.
5
Includes the dividend paid to ordinary shareholders in February 2023.
2022 Ordinary Share Total NAV Movement (£m)
Realisation Shares
Capital Returns and Distributions
The Company distributes capital back to shareholders through a range of methods, details of which are provided
in the section ‘Capital Distributions, NAV and Discount Management’.
Total Capital Returns and Distributions
Since Inception
Realisation
Class
Ordinary Shares Realisation Classes Combined
2016
2021
Dividends
and
Buybacks
5
£58.3m
Dividends and
Buybacks
£58.3m
Capital
Returns
£25.9m
Capital
Returns
£41.5m
Total
Distributions
£84.2m
Total since
inception
£99.8m
Total Capital
Returns
£15.6m
MVIR
MVR2
+31.5%
+0.8%
376.0p
185.3p
£3.5m
£0.7m
84.6%
0.0%
Ticker Shareholder
Total Return
3
Nav
Per share
Net Assets NAV
Distributed
SINCE INCEPTION
4
£98.1
+ £0.1
(£4.4)
(£0.1)
+ £0.0
+ £8.6
+ £0.4
(£3.1)
(£0.3)
(£5.0)
£101.9
80
85
90
95
100
105
110
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5
Report of the Chairman
I am pleased to present the audited Annual Report and
Financial Statements of Marwyn Value Investors Limited
(LSE: MVI, MVIR, MVR2) for the year ended
31 December 2022.
Investment Performance
Despite the challenges of 2022, the Board
acknowledges the Manager’s persistent efforts to
identify and collaborate with leading Management
Partners, resulting in the appointment of Mark
Hodges to MAC II and Waheed Alli to 450 plc. Their
extensive experience and deep sector knowledge
equip their respective acquisition vehicles with
exceptional leadership and expertise, allowing
them to continue pursuing their stated investment
strategies.
The acquisition vehicles have exercised patience in
identifying and executing platform deals, evaluating
a significant number of opportunities. With the
Fund maintaining its cash resources during these
uncertain times, it is well-positioned to support
the acquisition vehicles as they progress with their
stated investment strategies throughout 2023 and
beyond.
Furthermore, the Board is pleased with the
recognition of the historical VAT claim related to a
previous investment in Praesepe, providing further
capital for future investments.
Governance and Oversight of the Manager
The Board maintains an ongoing active relationship
and continuous dialogue with the Manager,
ensuring a comprehensive understanding of and
exchanges of views regarding its perspectives
on the portfolio and the wider market. My fellow
non-executives and I bring a combination of listed
fund and corporate experience at both operational
and board levels, allowing us to actively oversee
and challenge the Manager’s activities on behalf of
shareholders. My role is complemented by my Non-
Executive Chairmanship of the Marwyn Group and
the oversight it provides over the broader Marwyn
operations, while Martin Adams’ experience
and knowledge of the Manager provides further
effective oversight in his role as Senior Independent
Director.
In November 2022, following his family’s move to
Spain, Mark Brangstrup Watts retired as a partner
of the Manager and a member of its investment
committee. James Corsellis, Chief Investment
Officer, remains supported by Marwyn Partners
Antoinette Vanderpuije and Tom Basset, both of
whom have been part of the Marwyn team for over
a decade, alongside a wider team of investment
professional based in London and Jersey. We wish
Mark and his family the very best and are grateful
for his pivotal role in the Company’s and the
Manager’s history.
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Report of the Chairman
Shareholder Composition and
Communication
The Board and the Manager proactively engage with
our shareholders on an ongoing basis, striving to
understand their viewpoints and ensure they are
well-informed about the Company, the underlying
portfolio, and the forward-looking strategy. The
vast majority of our significant shareholders have
remained invested in the Company, continuing to
support the deployment of its liquid capital into
acquisition opportunities. The Manager and I,
alongside the rest of the Board are always available
to speak with shareholders, and I encourage any
shareholder to contact me directly at any time.
Shareholder Returns and Distributions
The Company aims to deliver long-term growth
in its NAV, alongside a consistent and predictable
quarterly dividend programme and a policy to
distribute 50% of net capital gains on portfolio
investments as and when they are realised. We
believe that the investment strategy and current
income profile of the Company are highly attractive
to shareholders.
Building high-quality companies requires time.
With our investment beginning upon the formation
of the acquisition vehicles, we typically anticipate
holding our investment in these companies for
5 to 7 years following their platform acquisition.
This anticipated timeframe allows the Manager to
support the medium to long-term ambitions of the
Management Partners as they execute their initial
acquisition, continue to deliver on their operational
plans, complete follow-on acquisitions, and develop
their business strategy. With the majority of the
portfolio being acquisition companies, the focus
remains on supporting the execution of their
respective strategies to maximise shareholder value.
This has been demonstrated through the success of
the Manager’s earlier acquisition vehicles, including
Advanced Computer Software, BCA Marketplace,
Breedon Aggregates, and Entertainment One,
among others.
Under our distribution policy, distributions are
maintained or grown on a per-share basis and
currently represent an annual dividend of 9.06
pence per share, paid in equal quarterly instalments.
Based on the closing share price of £0.925 as at 31
March 2023, this represents a yield of over 9.7%.
Wider Impact
The Board and the Manager have always been
conscious of the impact we can make beyond the
Fund’s aims to generate shareholder returns. As
detailed on page 28, Marwyn continues to support
charitable projects and initiatives. During 2022,
the Marwyn Trust supported charities including
Sumbandila, which offers merit-based scholarships
to exceptional children in rural areas of South
Africa; the Helen Bamber Foundation, a pioneering
human rights charity supporting refugees and
asylum seekers who have survived extreme
human cruelty; and the Spanish Red Cross, which
promotes social welfare and support through
its numerous projects aimed at protecting and
enriching the value of human life.
Marwyn has also committed to sponsoring
employee charity fundraising efforts and has
initiated a program with North London schools
to provide information and opportunities such
as mentoring and work experience placements
for young people who might not otherwise have
access to these resources.
The Manager has worked with Le Chameau
during the year on various ESG initiatives and
we continue to support diversity at board and
senior management levels within Marwyn and
our portfolio companies. The Board has had
continuous female representation since 2014.
Outlook
With the progress made during the year by
appointing two additional Management Partners
to MAC II and 450 plc, and considering the current
level of opportunities we are seeing across
the sectors that are the focus of our current
acquisition vehicles’ investment strategies, I
believe that with the support of the Manager
and our cash resources, the Company is well-
positioned to capitalise on opportunities that
will lay the groundwork for robust portfolio
performance in the coming years.
Robert Ware
Chairman
27 April 2023
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Report of the Manager
Who We Are
Founded in 2005, we are a specialist institutional sponsor
of European listed acquisition companies. We partner
with experienced industry executives who have built
careers in their industries and developed deep-rooted
expertise and relationships to enhance deal-sourcing and
subsequent platform build-out, utilising their wealth of
sector-specific knowledge.
Our Strategy
Marwyn’s strategy is to identify, support, invest in and
work alongside high-calibre, sector-leading, experienced,
operational management teams to acquire, manage,
build, and grow businesses headquartered in the UK,
Europe, or the Americas.
WHO WE ARE | A TRACK RECORD OF SUCCESS | OUR TEAM
| OUR APPROACH | CIO INVESTMENT COMMENTARY & OUTLOOK
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Report of the Manager
18 year track record of successful acquisition
companies across a range of sectors
Proven origination model based on accessing
proprietary deal flow
Management partnership model delivering deep
sector experience and operational expertise
Long track record of raising institutional equity
from and delivering returns to UK institutional
investors
Proprietary acquisition vehicle structure, we believe
is highly attractive to management and investors alike
andwhichprovidessignificantexecutionaladvantages
and long-term alignment between stakeholders
WHO WE ARE | A TRACK RECORD OF SUCCESS | OUR TEAM
| OUR APPROACH | CIO INVESTMENT COMMENTARY & OUTLOOK
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Report of the Manager
A Track Record of Success
As the UK’s leading sponsor of acquisition
vehicles
6
, our 11 companies which have
followed our current strategy and completed
a platform acquisition have delivered
£4.7 billion of profits to equity investors.
WHO WE ARE | A TRACK RECORD OF SUCCESS | OUR TEAM
| OUR APPROACH | CIO INVESTMENT COMMENTARY & OUTLOOK
6
Based on the number of UK listed acquis tion vehicles or SPACs launched on the London Stock Exchange since the date that Marwyn listed
tsfirstacquisitionvehiclein2005w thdatatakenfrominternalanalysisofthenumberofvehicleslaunchedandtheirsponsors,sourced
from LSE, Pitchbook, CapIQ and internal research.
10
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Report of the Manager
Simon Vivian
Robert Samuelson
Fiona Begley
Keith Tozzi
Hugh Aldous
TOTAL
The following table details the equity profits generated by our acquisition companies which had a similar overall
strategy to our new acquisition vehicles and which completed a platform acquisition, based upon all equity raised
(from all investors throughout their lifetime, including the period after we exited our cornerstone position) and with
returns calculated based upon (a) the offer price on sale of the entire company, or (b) the prevailing share price
(as at 31 March 2023) if still listed.
BCA Apr-15 Avril Palmer -Baunack Automotive £1,163m £2,137m 84%
ETO Feb-07 Darren Throop Media £747m £2,824m 278%
BREE Sep-10 Peter Tom Construction Materials £702m £1,332m 90%
ZEG Aug-15 Eamonn O’Hare Telecoms £388m £524m 35%
ACS Aug-08 Vin Murria Computer software £126m £725m 477%
COT Nov-06 Keith Tozzi Healthcare £117m £130m 11%
INP Oct-05 Mark Silver Testing & Inspection £116m £229m 97%
SID Jul-06 Sean Nutley Remediation £58m £1m (99%)
TLS Jun-05 Nick Harding Leisure £48m £128m 170%
MLO Oct-07 Adrian Carey Training £44m £98m 121%
ZTR Apr-05 Ian Blackburn Confectionery £35m £41m 15%
£3.5bn £8.2bn 130%
COMPANY TICKER ACQUISITION
DATE
MANAGEMENT
PARTNER(S)
SECTOR TOTAL EQUITY
INVESTED
TOTAL EQUITY
VALUE
% EQUITY
RETURNS
WHO WE ARE | A TRACK RECORD OF SUCCESS | OUR TEAM
| OUR APPROACH | CIO INVESTMENT COMMENTARY & OUTLOOK
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Report of the Manager
James Corsellis
Chief Investment Officer
James founded one of the earliest strategic technology
consultancies in 1994 and was Chief Executive Officer of
icollector plc, a leading provider of live auction trading
platforms. He later negotiated its joint venture with
eBay, which saw icollector become the exclusive partner
worldwide for traditional auction houses. James co-
founded and leads Marwyn and typically holds board
positions on Marwyn’s portfolio companies.
Tom Basset
Investment Partner
Tom joined Marwyn in 2010 from the Private Equity
Transaction Services Group at Deloitte. He leads the
investment team where he is involved in the origination
and assessment of new investment opportunities,
transaction execution, coordinating capital market
and M&A processes and providing strategic corporate
advice to portfolio company management teams. Tom
is a qualified Chartered Accountant and graduated from
Durham University with a BA (Hons) in Economics.
Antoinette Vanderpuije
Chief Financial Officer and Chief Operating Officer
Antoinette joined Marwyn in 2007 and leads the Finance,
Markets and Regulation Team. She has extensive M&A
and investment experience with a particular focus on
transaction tax structuring and incentive planning.
Antoinette previously worked in the finance team at
Arcadia Group and prior to that with Bourner Bullock
Chartered Accountants. She is a Chartered Accountant,
a Chartered Tax Advisor and holds a BA from University
College London.
Marwyn Group
James, Antoinette, and Tom are supported by a
highly experienced team of 11 individuals based
in London and Jersey who provide investment
management, corporate finance and operational
support to the Fund entities and our investee
companies.
Our Team
WHO WE ARE | A TRACK RECORD OF SUCCESS | OUR TEAM
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Report of the Manager
How We Invest
Over the last two decades, we have developed
extensive experience in executing successful
investment strategies in the public markets.
Throughout this time, we have invested across a broad
range of sectors in conjunction with leading executives
or management teams (our “Management Partners”).
Our Management Partners have added value through
the origination of investment opportunities, the
assessment and due diligence process and by playing
a long-term role in the hands-on execution of the
strategy, usually assuming the role of Chairman or
Chief Executive Officer. The success of our previous
vehicles has been based on a number of factors
including our ability to identify and partner with these
industry-leading Management Partners whilst drawing
on our transactional and corporate finance expertise
in developing and structuring a range of acquisition
vehicles that aim to meet the needs of all stakeholders.
Market Opportunity
Over the last 20 years, the London Stock Exchange
has been the venue for numerous highly successful
acquisition companies. We believe there remains
significant interest from both companies and industry
executives in using well-structured acquisition
companies on the public markets to execute growth
strategies across a range of sectors.
Building on our extensive experience of investing
through listed acquisition companies to execute buy-
and-build growth strategies alongside experienced
Management Partners, and reflecting on the much-
criticised US SPAC model, we believe the Marwyn
Acquisition Company structure (the ‘MAC’ structure)
is uniquely designed to be attractive to institutional
investors, business owners and management teams.
The principal enhancements being:
• Ensuring long term alignment: management
and sponsor incentives aligned to long term equity
performance and no discounted shares/warrants
or upfront promoter fees
• Increasing flexibility in raising capital: the
addition of innovative mechanisms to raise equity
capital from institutional investors
• Improving transactional efficiency: a new
transaction process allowing the execution
of a reverse acquisition on a timetable that is
comparable with investment from private equity
providers
Our Approach
WHO WE ARE | A TRACK RECORD OF SUCCESS | OUR TEAM
| OUR APPROACH | CIO INVESTMENT COMMENTARY & OUTLOOK
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Report of the Manager
WHO WE ARE | A TRACK RECORD OF SUCCESS | OUR TEAM
| OUR APPROACH | CIO INVESTMENT COMMENTARY & OUTLOOK
Dear Investors,
I am delighted to share with you, our investment
performance and outlook for the coming year. Despite
the markets headwinds during 2022, I am grateful
for the unwavering support from our exceptional
investment management team, led by Antoinette
Vanderpuije and Tom Basset, who have been with
Marwyn for over a decade. Our wider Marwyn team
also provides crucial operational, regulatory, and
transactional expertise, which greatly benefits both
our investment strategy and the operations of our
investee companies.
Our Investment Philosophy and Strategy
At Marwyn, the success of our investment approach
hinges on identifying and partnering with outstanding
management teams. We believe that exceptional
management talent, rather than capital or companies,
is the scarcest resource. This perspective informs
every aspect of our investment process, from idea
generation to ongoing collaboration with our portfolio
companies.
Instead of relying on conventional methods such as
screening for companies or participating in private
equity auctions, we focus on seeking out, working
with, and learning from, exceptional management
teams. Our past partnerships with leaders like Avril
Palmer Baunack, Peter Tom, Darren Throop, and
Vin Murria illustrate the unique value proposition of
Marwyn’s investment model.
This approach extends beyond initial investments,
shaping our ongoing interactions with our portfolio
companies. We actively engage with our investee
companies by sitting on their boards and providing
day-to-day support, often maintaining close
relationships even after the investment period has
ended.
We encourage interested investors to reach out to
our investor relations team, led by Scott Danks, or
contact me directly for more information about our
investment model.
Review of 2022 and Outlook for 2023
In 2022, we delivered a modest positive NAV
performance for ordinary shareholders of 1.5% amidst
a difficult market environment, with the average
UK small-cap declining by 22%. Our significant cash
position will now allow us to capitalise on falling
valuation multiples and tightening credit conditions.
These market conditions are revealing the weaknesses
in leveraged investment models, which we have
consciously avoided, and are creating special situations
that present attractive entry prices. With continued
outflows from UK active equity funds, our focus
remains on opportunities where we can act as the
principal investor and funding source.
Our investee companies, such as AdvancedAdvT led by
Vin Murria, have demonstrated agility and discipline
in their investment activities. Although the offer for
M&C Saatchi did not proceed, the financial impact
on AdvancedAdvT was minimal. With over £100m in
cash, a strong roster of institutional investors, and a
significant decline in technology valuations, we believe
AdvancedAdvT is well-positioned for 2023 under Vin’s
leadership.
Le Chameau, our premium footwear business led
by Corry Taylor, has made significant strides since
2019, overcoming global shipping and supply chain
disruptions as well as a post-Covid slowdown in
demand. With a focus on expanding its direct-
to-consumer online business and increasing its
addressable customer base, Le Chameau aims to
capitalise on the long-term growth prospects of the
premium outdoor market. However, the company will
proceed cautiously in the current market environment
and prioritise consolidating its achievements to date.
During 2022, we also announced new management
partnerships with Mark Hodges through Marwyn
Acquisition Company II Limited and Waheed Alli
through 450 plc (previously Marwyn Acquisition
Company plc). Mark Hodges brings a wealth of
experience from leadership roles at Centrica, Aviva,
and Reassure and will focus on the pensions and
wealth management space.
CIO Investment Commentary and Outlook
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Report of the Manager
WHO WE ARE | A TRACK RECORD OF SUCCESS | OUR TEAM
| OUR APPROACH | CIO INVESTMENT COMMENTARY & OUTLOOK
Waheed Alli has an exceptional background in media
and entertainment, with successful ventures such as
Planet 24, Shine, and Silvergate Media to his credit. We
are excited about the opportunities to acquire proven
entertainment properties and intellectual property
that can be exploited in new ways and through new
channels.
In terms of prior investments, we were pleased to
recognise the £10 million VAT claim from our previous
investment in Praesepe, with the final £5 million cash
receipt expected later this year.
We are deeply grateful for the support we have had
in 2022 from our investors and the Board. We expect
2023 to be a very active year, we believe we have a
fantastic group of management partners, and, as we
found in the years following the financial crisis, we
believe it is in these types of investing environments
where our investment strategy comes to the fore.
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Management Partner
Corry Cavell-Taylor
Corry Cavell-Taylor is CEO of Le Chameau Holdings Limited.
He is also MD of Bradshaw Taylor Limited and the creator
of Schöffel Countrywear. Corry has over two decades of
experience in the country sports market worldwide and is
a director of The Outdoor Industries Association of Great
Britain.
Corry started distributing outdoor and country brands over 25
years ago, having taken over Bradshaw Taylor from his father
who was the third generation of the family to run the business,
started in 1895 by Corry’s Great-Grandfather. Bradshaw Taylor
distributes leading brands in outdoor and country clothing
and equipment, connecting these brands with retailers and
consumers throughout the UK, Europe and USA.
Corry has a BSc from Birmingham University and an MBA from
Cranfield School of Management.
Value Creation Opportunity
• Capitalise on the opportunities created by an iconic
brand with category leading products
• Build a leading luxury goods business, capable of scaling
sales across the UK, Europe, North America and other
potential new markets
• Broaden lifestyle appeal, utilising and protecting brand
heritage
• Better understand the existing and potentially
addressable customer base to raise awareness and build
appeal
• Further expand the direct-to-consumer e-commerce
channel, deploying enhanced digital marketing strategy
Overview
Le Chameau was founded in Cherbourg, France in 1927 by
Claude Chamot to create premium handmade rubber boots
that would deliver unrivalled comfort and durability. He began
creating prototypes using natural rubber and went on to
pioneer the use of vulcanization to increase durability. Once
Monsieur Chamot had refined his process, individuals from all
over France were coming to him to have a bespoke boot made.
Today, Le Chameau is an iconic technical footwear brand with
over 90 years of heritage, a leader in the premium rubber
boot market with a passionately loyal consumer base, brand
ambassadors and a growing market. As Manager, we too are
passionate about the product and are excited about the launch
of recent brand partnerships, new product development and
the potential for future expansion of production capacity.
Le Chameau’s core product offering includes a range of
premium rubber and leather boots designed for country,
lifestyle and sporting pursuits, serving outdoor professionals
and connoisseurs, as well as style conscious rural and urban
consumers.
The business continues to make operational improvements in
its factory in Casablanca, where it has manufactured its own
rubber boots since 1949 and is significantly scaling up the
training programme of its Master Bootmakers. The business
expanded production capacity, with over 200,000 pairs of
rubber boots produced in 2022, with the potential to scale up
production further in the coming years.
Following the partnership with Bradshaw Taylor in 2019,
Le Chameau has grown revenue across both its B2B and
D2C channels. B2B sales have benefitted from recovering
stock levels following the improved production capacity
in the factory, enabling the business to satisfy more of the
underlying demand for the product from wholesalers. With
approximately 28% of revenue in 2022 derived from the D2C
channel, the business has built a strong e-commerce platform,
with ambitions to increase this over time as the brand
continues to build upon its understanding of both its existing
and potentially addressable consumer base.
Investment Portfolio
Le Chameau Luxury Goods www.lechameau.com
Ordinary Shares
2016 Realisation Shares
2021 Realisation Shares
As at 31 December 2022
NAV/share Contribution (£)
£0.34
£2.37
£0.34
% of NAV
19.4%
62.9%
18.5%
LE CHAMEAU | ADVANCEDADVT | 450 | MAC II | ACQUISITION COMPANIES | VAT RECLAIM
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Le Chameau enjoys a deep relationship with its core customer
group and benefits from being promoted by a broad range
of high profile influencers and celebrities who choose to
wear the brand. Recent marketing initiatives have included
the successful launch of brand partnerships with Patou (part
of LVMH) and Fairfax & Favor, and brand coverage in both
national and international media. These initiatives, as part of a
broader marketing strategy, have contributed to progressing
the brand’s consumer profile, reach and engagement, with
potential for further growth ahead.
Recently the business has, like other retailers, experienced a
more challenging consumer environment and macroeconomic
backdrop. With a strengthened B2B proposition following
the Bradshaw Taylor partnership, the business is also now
increasingly focusing on resource, brand and digital marketing
investment into the D2C channel as it transitions from a
B2B centric business model towards the scale, customer
relationship and valuation benefits of a genuine omni-channel
brand.
We believe in the product and the team. The business is
well-placed to deliver on its potential to continue to scale in
both its core and nascent markets, further building its brand,
consumer profile and engagement, and firmly positioning it
amongst other more established luxury apparel companies.
LE CHAMEAU | ADVANCEDADVT | 450 | MAC II | ACQUISITION COMPANIES | VAT RECLAIM
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LE CHAMEAU | ADVANCEDADVT | 450 | MAC II | ACQUISITION COMPANIES | VAT RECLAIM
Investment Portfolio
Ordinary Shares
2016 Realisation Shares
2021 Realisation Shares
NAV/share Contribution (£)
£0.21
£-
£0.21
% of NAV
12.1%
-%
11.5%
AdvancedAdvT Digital Software & Services www.advancedadvt.com
As at 31 December 2022
Management Partner
Vin Murria
Vin was the founder and CEO of Advanced Computer Software
Group plc (2008 to 2015), one of Marwyn’s previous vehicles
which generated equity returns of 477% and was acquired
by Vista Equity Partners in 2015, and the CEO of Computer
Software Group plc (2002 to 2007) acquired by Hellman &
Friedman in 2007. She has more than 25 years of experience
in the software sector and is also currently a non-executive
director of Softcat plc and Bunzl plc.
Previous directorships have included serving as a non-
executive director at M&C Saatchi plc, Sophos Group plc,
Zoopla Property Group plc, Chime plc, DWF plc and COO of
Kewill Systems plc (now Blujay). Vin holds a bachelor’s degree
in Computer Science, an MBA and a Doctorate in Business
Administration (Hon). Vin became an Officer of the Most
Excellent Order of the British Empire in 2018 for her services to
Technology and the empowerment of women in the sector.
Vin is the founder of the PS Foundation, a charity set up to
support the education of women and children in poverty in
India and the UK.
Value Creation Opportunity
• Well-capitalised vehicle with an experienced and highly
credible management team
• Focused on opportunities in the digital, software and
services sector likely to benefit from structural changes
brought about by the current macro environment and
the acceleration in digitalisation effecting the way people
live, work and consume and the way that businesses
operate, engage and sell to customers
Overview
AdvancedAdvT was launched in 2020 and subsequently
raised £130 million in March 2021, including a £17.5 million
subscription from Vin Murria, to support the company’s
strategy.
AdvancedAdvT acquired a minority stake in M&C Saatchi plc
in January 2022 and subsequently made a formal offer for the
remaining M&C Saatchi plc shares. The AdvancedAdvT Board
believed that acquiring M&C Saatchi plc would provide the
opportunity to create significant value for both AdvancedAdvT
and M&C Saatchi shareholders through building a data,
analytics and digitally focussed creative marketing business,
with available funding to execute M&A at a faster pace and
with additional expertise than the standalone M&C business is
able to achieve.
AdvancedAdvT’s offer for M&C did not receive sufficient
acceptances to reach the 90% acceptance threshold and
consequently lapsed. A competing offer for M&C, made
by Next Fifteen Communications plc, also failed to receive
sufficient support and lapsed.
As a continuing significant shareholder in M&C, AdvancedAdvT
has stated that it continues to assess all potential value
creation opportunities for M&C.
AdvancedAdvT remains well capitalised with over £100
million of investible cash which, given both Vin Murria’s track
record and the current market environment, should afford
the company significant opportunities. AdvancedAdvT notes
the reduction in valuations of potential acquisition targets,
particularly over the last 12 months, which is expected to
provide increased opportunities. AdvancedAdvT has evaluated
a number of businesses over this period but has remained
highly selective in their approach to investing at the right
valuation. Key criteria considered in evaluating their pipeline of
opportunities include:
• highly predictable revenue streams;
• high customer retention;
• products or services with high barriers to entry;
• extensive growth opportunities;
• significant free cash flow generation; and
• well run businesses in fragmented industries with
potential for consolidation.
As at 28 February 2023 AdvancedAdvT’s net assets of £127.3
million included interest-bearing cash of £103.4 million and
12,000,000 shares in M&C Saatchi plc valued at £23.3 million
(based on a 10 day VWAP price of 194p).
18
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Ordinary Shares
2016 Realisation Shares
2021 Realisation Shares
NAV/share Contribution (£)
£0.09
£-
£0.09
% of NAV
5.0%
-%
4.8%
LE CHAMEAU | ADVANCEDADVT | 450 | MAC II | ACQUISITION COMPANIES | VAT RECLAIM
Investment Portfolio
450 plc Content, Media, Technology www.450plc.com
(previously named Marwyn
Acquisition Company plc)
Cash held
Acquisition target size
Target sectors
Listing
£4.5m
Up to £500m
Content, Media, Technology
LSE AIM
As at 31 December 2022
Management Partner
Waheed Alli
Waheed Alli has over 30 years’ experience across the media,
retail, entertainment and technology sectors, having launched
and grown a number of highly successful private and public
businesses in his career.
Waheed co-founded Planet 24, a TV production company
which produced shows such as The Big Breakfast, The Word
and Survivor (created by Charlie Parsons). Planet 24 was
sold to Carlton Productions, now known as ITV Studios, in
1999. Waheed co-founded TV production company, Shine,
and was Chair of Chorion plc, including during its time as a
listed business between 2003 and 2006 delivering share price
growth of over 275%.
As Founder and CEO of Silvergate Media, Waheed acquired
the IP and distribution rights to The Octonauts in 2011,
establishing international partnerships with Netflix, Disney
and Nickelodeon before selling Silvergate Media to Sony in
2019.
Waheed was also Chair of ASOS plc between 2001 and 2012
where he oversaw market capitalisation growth from £12.3
million at IPO to £1.9 billion.
Waheed Alli has served as a member of the House of Lords
since 1998.
Value Creation Opportunity
• Ongoing digital transformation of the media and
entertainment industries and widespread adoption of
digital media has led to a fundamental change in the way
content is created, consumed and engaged with
• Opportunity to invest in content, media or technology
companies that have facilitated and are expected to
continue to benefit from this shift
Overview
In connection with the appointment of Waheed Alli as Chair
in November 2022 and following shareholder approval at the
company’s AGM in December 2022, the strategy of 450 plc was
amended to focus on acquisition opportunities arising within
the traditional and digital creative industries encompassing
the content, media and technology sectors. 450 plc will
consider the acquisition of private companies and public offers
for, and mergers with, existing listed businesses, in the UK and
internationally.
The 450 plc directors believe that the ongoing digital
transformation of the media and entertainment industries and
widespread adoption of digital media has led to a fundamental
change in the way content is created, consumed and engaged
with. Audiences and consumers are engaging with content
across multiple formats, including experiential and immersive
media, utilising both physical and digital delivery, alongside
the associated emergence of augmented and virtual reality
technologies.
The 450 plc directors believe there is a significant opportunity
to invest in content, media or technology companies that have
facilitated and are expected to continue to benefit from this
shift.
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LE CHAMEAU | ADVANCEDADVT | 450 | MAC II | ACQUISITION COMPANIES | VAT RECLAIM
Investment Portfolio
Marwyn Acquisition Financial Services,
Company II Limited Consumer, Technology www.marwynac2.com
Ordinary Shares
2016 Realisation Shares
2021 Realisation Shares
NAV/share Contribution (£)
£0.17
£-
£0.17
% of NAV
9.7%
-%
9.2%
Capital raised
Acquisition target size
Target sectors
Listing
£12.7m
Generally expected to be greater than £100m
Financial Services, Consumer, Technology
LSE Main Market
As at 31 December 2022
Management Partners
Mark Hodges
Mark Hodges has over 30 years’ experience across the
financial services and consumer sectors, including extensive
FTSE 100 PLC board experience with Centrica plc and Aviva plc.
As former CEO of ReAssure, Mark led the business through
the £425 million acquisition of Quilter’s UK Heritage business
and oversaw the sale of Reassure to Phoenix Group Holdings
in 2020 for £3.25 billion. At the time of the sale, ReAssure had
approximately £80 billion of assets under administration, 4
million customers and approximately 2,500 employees.
Will Self
Will Self has over twenty years of cross-functional experience
leading financial brands in the UK, including driving M&A
and has held CEO positions at Curtis Banks Group PLC, a
leading UK pension provider, offering a range of SIPP and
SSAS solutions for individuals and businesses and Suffolk
Life, a division of Legal & General, as well as holding the Chief
Commercial Officer role at Cofunds, a sister company within
the Legal & General. Will also holds a variety of non-executive
roles, including positions with a number of charities and as
deputy chair on the FCA’s Smaller Business Practitioners Panel.
20
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LE CHAMEAU | ADVANCEDADVT | 450 | MAC II | ACQUISITION COMPANIES | VAT RECLAIM
Investment Portfolio
Value Creation Opportunity
• Newly established vehicle, led by a highly experienced
and well-regarded management team
• Seeking acquisition opportunities in the financial
services, consumer and technology sectors set to
benefit from social and macroeconomic trends brought
about by changing demographics, the concentration
and intergenerational transfer of wealth and increasing
needs for social and non-financial family support
Overview
In connection with the appointment of Mark Hodges as
Chairman in June 2022, the strategy of MAC II was refined such
that it now focuses on pursuing acquisition opportunities in
the financial services, consumer and technology sectors.
The MAC II directors believe that the current market backdrop
has amongst a range of drivers, four notable interrelated
themes which the MAC II directors believe are shaping a clear
customer need that remains largely unmet:
1. Changing population and demographics –
An increasingly ageing population is likely to have a
significant impact on economies, social care systems
and household finances. The MAC II directors believe
future financial solutions will need to reflect an
increasing level of intergenerational financial and
social dependencies.
2. Wealth transfer and the role of families –
The role played by families in providing future
financial solutions is of increasing importance, with
parents, other family members and friends providing
progressively more support to new homeowners and
adult dependents.
3. Socialandnon-financialfamilysupport–
Vast numbers of people across the UK and the US
provide unpaid care for a friend or family member.
4. Concentration of wealth –
Across the UK and US, wealth is principally
concentrated in property, pension assets and equities.
With the combination of these social and macroeconomic
conditions and trends, the MAC II directors believe all
generations are facing increasingly challenging financial
situations which are creating several problems to be solved.
The MAC II directors believe there is a well-defined need and
opportunity, now more than ever, for clear and impartial
support and solutions to be provided to, and shared amongst,
friends, family and peers.
MAC II intends to execute its strategy through a combination
of selective M&A of platform and bolt-on businesses, potential
strategic partnerships with established financial services
operators as well as ongoing operational improvements.
Target company market segments, principally expected to
be in the UK and US, may include, but are not limited to:
• fintech digital platforms
• digital content platforms
• life and pension platforms and assets
• life-insurance assets
• lifetime mortgages and equity release
• wealth managers and advisers
• brokerage and associated services
• mortgage advisory
• healthcare related services
• estate planning and associated legal and tax services
• later life planning and assisted care services
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Overview
The Manager launched MAC III in December 2020 as an LSE
Main Market listed acquisition company. £12.5 million has
been invested by the Marwyn Funds into MAC III.
In April 2022 MAC III published a prospectus in relation to a
12 month placing programme for a C ordinary redeemable
share class (“C Shares”). It is expected that the ability to issue
C shares where appropriate, alongside the existing flexibility
of the MAC structure to utilise the issuance of either listed
ordinary shares or unlisted B shares provides MAC III with a
competitive advantage in securing and financing attractive
acquisition opportunities and bringing the best executive
management back to the UK public markets.
The initial placing programme has subsequently been
terminated, saving on the legal and professional fees and
management time that would be incurred in its renewal
whilst the focus remains firmly on identifying the company’s
management partners and platform acquisition. MAC III will be
able to re-issue a prospectus to enable the company to utilise
a C share class at short notice where deemed appropriate by
the Directors.
MAC Alpha, launched in December 2021, is an LSE Main
Market listed acquisition company which is expected to
focus on investment opportunities where a combination of
management expertise, improving operating performance,
freeing up cashflow for investment and implementation of
a focused buy and build strategy can unlock growth in core
markets and often into new territories and adjacent sectors.
MAC Alpha is currently not proposing to issue redeemable
shares and is seeking Management Partners and transactions
which can utilise its Main Market listing on the London
Stock Exchange.
Investment Portfolio
Acquisition Companies:
Marwyn Acquisition Company III Limited
MAC Alpha Limited
% of NAV
0.5%
-%
-%
NAV/share Contribution (£)
£0.01
£-
£-
LE CHAMEAU | ADVANCEDADVT | 450 | MAC II | ACQUISITION COMPANIES | VAT RECLAIM
Ordinary Shares
2016 Realisation Shares
2021 Realisation Shares
NAV/share Contribution (£)
£0.17
£-
£0.17
% of NAV
9.7%
-%
9.2%
Capital raised
Acquisition target size
Target sectors
Listing
£12.7m
Greater than £100m
Various
LSE Main Market
£0.7m
Greater than £100m
Various
LSE Main Market
As at 31 December 2022
MAC III
MAC III MAC ALPHA
MAC ALPHA
22
|
Investment Portfolio
VAT Reclaim
LE CHAMEAU | ADVANCEDADVT | 450 | MAC II | ACQUISITION COMPANIES | VAT RECLAIM
We have been pleased to report the progress over the year
made with the historic VAT reclaims in which the Master Fund
has an interest.
In November 2012, an underlying investment of the Master
Fund, Le Chameau Group plc (“LCG”) (formerly Marwyn
Management Partners Plc) sold its holding in Praesepe plc, a
company operating in the gaming industry.
At the time of the sale there was an ongoing dispute between
the gaming industry and HMRC on the principle of fiscal
neutrality. The basis of the dispute was that some similar
forms of gambling were treated differently for VAT purposes
and test cases were pursued by The Rank Group Plc and
Done Brothers (Cash Betting) Ltd.
Based on these test cases, Deloitte LLP and
PricewaterhouseCoopers LLP were engaged by Praesepe
plc to submit VAT reclaims to HMRC on a contingent fee
basis. Certain of these VAT reclaims relate to the period
of LCG’s ownership and as such, under the terms of the
sale agreement, a subsidiary of LCG retained a beneficial
interest in the VAT reclaims that related to the period of LCG’s
ownership. The existence of these contingent VAT reclaims
was disclosed in the historic financial statements of LCG and
the contingent asset was transferred in 2020 to the Master
Fund as part settlement of the outstanding loan between the
LCG group and the Master Fund.
Following the First-tier Tribunal ruling in favour of The Rank
Group Plc, HMRC publicly confirmed that it would not appeal
the decision made by the First-tier Tribunal.
Over the course of 2022, £4.98 million was agreed and
received by the Master Fund and there is sufficient certainty
over the recoverability of the remaining amounts to
recognise a receivable of £5.02 million as at 31 December
2022. These remain dependent on final settlement with
HMRC and whilst the actual amount received may be
different, any difference is not expected to be material. The
timing of receipt of cash into the Master Fund also remains
uncertain; based on the timeline for the settlement of
previous claims, it is currently estimated that these amounts
will be received in 2023.
This is a long-awaited and positive result for the Company.
The Board believes after years of uncertainty about the
settlement, the amount recovered from HMRC is a good
outcome for shareholders.
There is no net capital gain arising from the settlement of
the VAT reclaims and accordingly, no cash return is due to
ordinary shareholders on receipt of the funds into the Master
Fund, which will be retained by the Master Fund. To date,
the Company has distributed over £28.1 million to ordinary
shareholders in excess of the amount that would be required
under the distribution of 50% net capital gains as described
in the Company’s ordinary share distribution policy.
A further announcement will be made by the Company in
relation to any distribution to the Company’s 2016 realisation
shareholders and/or 2021 realisation shareholders following
receipt of the reclaims into the Master Fund.
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ORDINARY SHARES
Allocation of NAV by company at 31 December 2022
Based upon the Company’s indirect investments in the Portfolio Companies through its interest in the Master Fund
and MVI II LP, the Company’s total NAV attributable to ordinary shareholders as at 31 December 2022 is broken
down as follows:
Allocation of NAV by company at 31 March 2023
Based upon the Company’s indirect investments in the Portfolio Companies through its interest in the Master
Fund and MVI II LP, the Company’s total NAV attributable to ordinary shareholders as at 31 March 2023 is broken
down as follows:
All portfolio assets are held at fair value by the Marwyn Funds which hold them in accordance with International Financial
Reporting Standards. Where there is no active market for a listed investment, or where the investment is unlisted, the
valuation methodologies applied are fully compliant with International Private Equity and Venture Capital valuation
guidelines as updated.
Allocation of Net Asset Value
Le Chameau Unlisted Luxury Goods 19.4% 0.34 Master Fund
AdvancedAdvTLimited ADVT Software 12.1% 0.21 MVIIILP
MarwynAcquisitionCompanyIILimited MAC2 Financial,Consumer,Technology 9.7% 0.17 MVIIILP
Marwyn Acquisition Company III Limited MAC3 Various 9.7% 0.17 MVI II LP
450plc 450 Content,Media,Technology 5.0% 0.09 MVIIILP
MAC Alpha Limited MACA Various 0.5% 0.01 MVI II LP
Zegona Communications plc ZEG Communications 0.4% 0.01 MVI II LP
Cash 45.2% 0.80 Various
Other assets / liabilities (2.0)% (0.03) Various
Net assets 100.0% 1.77
Le Chameau Unlisted Luxury Goods 17.0% 0.28 Master Fund
AdvancedAdvTLimited ADVT Software 12.2% 0.20 MVIIILP
MarwynAcquisitionCompanyIILimited MAC2 Financial,Consumer,Technology 10.1% 0.17 MVIIILP
Marwyn Acquisition Company III Limited MAC3 Various 10.1% 0.17 MVI II LP
450plc 450 Content,Media,Technology 5.3% 0.09 MVIIILP
MAC Alpha Limited MACA Various 1.0% 0.02 MVI II LP
Zegona Communications plc ZEG Communications 0.4% 0.01 MVI II LP
Cash 44.9% 0.75 Various
Other assets / liabilities (1.0)% (0.02) Various
Net assets 100.0% 1.67
The investment in Le Chameau is held though Silvercloud Holdings Limited
Cash is primarily held by the Master Fund
COMPANY TICKER FOCUS % OF NAV
NAV/SHARE
CONTRIBUTION
(£)
HELD BY
COMPANY TICKER FOCUS % OF NAV
NAV/SHARE
CONTRIBUTION
(£)
HELD BY
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|
2016 REALISATION SHARES
Allocation of NAV by company at 31 December 2022
Based upon the Company’s indirect investments in the Portfolio Companies through its interest in the Master Fund,
the Company’s total NAV attributable to 2016 realisation shareholders as at 31 December 2022 is broken down as
follows:
Allocation of NAV by company at 31 March 2023
Based upon the Company’s indirect investments in the Portfolio Companies through its interest in the Master Fund,
the Company’s total NAV attributable to 2016 realisation shareholders as at 31 March 2023 is broken down as
follows:
Allocation of Net Asset Value
Le Chameau Unlisted Luxury Goods 62.9% 2.37 Master Fund
Zegona Communications plc ZEG Communications 1.9% 0.07 Master Fund
Cash 38.7% 1.45 Various
Other assets / liabilities (3.5)% (0.13) Various
Net assets 100.0% 3.76
Le Chameau Unlisted Luxury Goods 58.3% 1.99 Master Fund
Zegona Communications plc ZEG Communications 1.8% 0.06 Master Fund
Cash 42.0% 1.43 Various
Other assets / liabilities (2.1)% (0.07) Various
Net assets 100.0% 3.41
COMPANY TICKER FOCUS % OF NAV
NAV/SHARE
CONTRIBUTION
(£)
HELD BY
COMPANY TICKER FOCUS % OF NAV
NAV/SHARE
CONTRIBUTION
(£)
HELD BY
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2021 REALISATION SHARES
Allocation of NAV by company at 31 December 2022
Based upon the Company’s indirect investments in the Portfolio Companies through its interest in the Master Fund,
the Company’s total NAV attributable to 2021 realisation shareholders as at 31 December 2022 is broken down as
follows:
Allocation of NAV by company at 31 March 2023
Based upon the Company’s indirect investments in the Portfolio Companies through its interest in the Master Fund,
the Company’s total NAV attributable to 2021 realisation shareholders as at 31 March 2023 is broken down as
follows:
Allocation of Net Asset Value
Le Chameau Unlisted Luxury Goods 18.5% 0.34 Master Fund
AdvancedAdvTLimited ADVT Software 11.5% 0.21 MasterFund
MarwynAcquisitionCompanyIILimited MAC2 Financial,Consumer,Technology 9.2% 0.17 MasterFund
Marwyn Acquisition Company III Limited MAC3 Various 9.2% 0.17 Master Fund
450plc 450 Content,Media,Technology 4.8% 0.09 MasterFund
Zegona Communications plc ZEG Communications 0.4% 0.01 Master Fund
Cash 48.0% 0.89 Various
Other assets / liabilities (1.6)% (0.03) Various
Net assets 100.0% 1.85
Le Chameau Unlisted Luxury Goods 16.0% 0.29 Master Fund
AdvancedAdvTLimited ADVT Software 11.5% 0.21 MasterFund
MarwynAcquisitionCompanyIILimited MAC2 Financial,Consumer,Technology 9.6% 0.17 MasterFund
Marwyn Acquisition Company III Limited MAC3 Various 9.6% 0.17 Master Fund
450plc 450 Content,Media,Technology 5.0% 0.09 MasterFund
Zegona Communications plc ZEG Communications 0.4% 0.01 Master Fund
Cash 48.9% 0.87 Various
Other assets / liabilities (1.0%) (0.02) Various
Net assets 100.0% 1.79
COMPANY TICKER FOCUS % OF NAV
NAV/SHARE
CONTRIBUTION
(£)
HELD BY
COMPANY TICKER FOCUS % OF NAV
NAV/SHARE
CONTRIBUTION
(£)
HELD BY
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27
Environmental, Social and Governance
As an investment company, the Company delegates
the day-to-day management of its business to the
Manager (the authority of the Manager is detailed
in the Report of the Directors). Whilst the Company
looks to the Manager in relation to the execution of its
investment strategy, in carrying out its activities and in
its relationships with service providers, the Company
aims to conduct itself responsibly and fairly.
ESG and our Investments
The Company’s investments are comprised
predominantly of acquisition companies, which are
yet to acquire platform targets. Le Chameau is the
only operating business, which we currently hold a
significant investment in.
During the year, we have partnered with the Le
Chameau management team to steer a number of
ESG initiatives within the business. Le Chameau has
a deep connection to the countryside and to the
sea, designing high quality handmade rubber boots
for farmers, fishermen, field sport enthusiasts and
gardeners. The business recognises the natural world
which its customers love and thrive in is coming under
increasing threat from climate change and human
activity and is aware that by producing and selling
products the business is playing a part in this damage
and must counter its impact on the natural world.
During the period, Le Chameau has:
• Built up its internal expertise, to better understand
the impact the business has on the planet.
• Assessed the composition of the Le Chameau
boots and looked at sourcing alternative and more
sustainable materials.
• Implemented improvements at the factory to
reduce its carbon footprint, through energy
efficiency enhancements (i.e, moving to LED
lighting) and introduced initiatives to reduce waste.
The Le Chameau Maîtres Bottiers have been making
boots by hand for nearly 100 years, with traditional
skills passed from generation to generation.
Le Chameau has always appreciated and valued its
people, and during the year the business invested in
training covering health and safety, engineering and
bootmaking, alongside soft skills training programmes
including language and IT courses which are available
to all Moroccan staff.
We have also supported Le Chameau in designing
and implementing a scheme which incentivises and
rewards its staff based on measurable criteria linked
to total shareholder returns, allowing them to share in
the success of the business and aligning the interests
of staff and shareholders.
Le Chameau has in place a structured governance
framework. During the year, through the board seats
held by members of the Manager, we have continued
to feed-back and work with the Le Chameau team to
further refine board reporting documentation. We
believe that the materials presented and discussed at
board meetings are critical to the board making the
right strategic decisions for the business.
Outside of our work with Le Chameau, we are invested
in public companies with listings on AIM or the Main
Market of the London Stock Exchange. By virtue of
these Acquisition Companies being listed, they are
required to comply with relevant rules and regulations;
whilst not all of these Acquisition Companies have
adopted a Corporate Governance Code, given the
nature and size of the businesses, they do have in
place a structured governance framework, including
policies and procedures.
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Environmental, Social and Governance
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29
Environmental, Social and Governance
ESG at the Manager
We are a small team, and our people are fundamental
to our business. We are committed to providing
an inclusive and collaborative place to work where
people are recognised and rewarded for delivering on
our strategic ambitions and values (including sound
and effective risk management) and incorporating
measures to avoid conflicts of interest and excessive
risk taking. Our incentive scheme ensures that the
team are aligned with the Company’s shareholders,
whilst providing an incentive that allows us to hire and
retain the best talent.
Our dynamic team includes people with a range of
qualifications, backgrounds, and expertise. We have a
highly qualified team and foster a culture of continued
learning and development to keep our team at the
forefront of market practices.
The health and wellbeing of our team is imperative.
Alongside encouraging a work-life balance, we have
an on-site gym offering personal training sessions
and support sporting pursuits, recently sponsoring
an employee’s local softball team and contributing to
another team member’s charity fundraising for the
London marathon.
We are mindful of our place in the communities in
which we work and live and encourage our team to
contribute and give back. Our partners work with
a handful of schools in North London, providing
students with presentations on what a job in
investment management entails, as well as one-
on-one mentoring, interview practice and work
experience at the Manager.
We also operate the Marwyn Trust which provides
financial support to charities both in the UK and
further afield.
The Marwyn Trust
The Marwyn Trust was formed in 2009 by Marwyn’s
partners and was established to make donations from
Marwyn and associated companies and individuals
to charitable institutions at the discretion of the
trustees. The Trust has recently donated to charitable
institutions working with the underprivileged and
in the fields of education, healthcare, economic
development and supporting individuals in the arts
profession. During 2022, The Marwyn Trust raised in
excess of £500,000, with all available proceeds passed
on to charities.
During 2022, The Marwyn Trust made charitable
donations to the following charitable institutions as
well as supporting humanitarian aid efforts in Ukraine:
Sumbandila Scholarship Trust (“Sumbandila”)
Sumbandila provides full scholarships to private
schools, as well as an educational outreach program to
children living in rural areas in South Africa. This aims
to transform the lives of underprivileged children,
creating entrepreneurs and leaders who will make
significant contributions to the future of South Africa.
Marwyn management have built strong relationships
with Sumbandila, having seen first-hand the work that
they do.
Helen Bamber Foundation (“HBF”)
HBF is a human rights charity that gives survivors of
trafficking and torture the strength to move on. Each
of their clients has a complex, unique and painful
history. Most survivors have either been trafficked
to the UK or have fled their country of origin after
experiencing some of the most abhorrent crimes.
The HBF ensures survivors are free, healthy, safe and
are protected from re-victimisation, detention and
poverty.
Spanish Red Cross (Cruz Roja Española) (“SRC”)
SRC is an organisation that promotes social welfare
and support through their many projects, from
humanitarian aid, social inclusion and environmental
protection, to focusing on accessibility to education
and personal health, the Red Cross aims to protect and
enrich the value of human life.
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Environmental, Social and Governance
The Marwyn Trust
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31
As is common to many investment companies, the Company’s shares trade at a discount to their underlying NAV.
The average discount to NAV of the Company’s ordinary shares during the year was 37.4%, compared to the
equivalent 34.4% average in the prior year. The discount range was 32.6% to 45.4%. The Company has a range
of features and policies that we believe act to mitigate the overall discount level:
Dividend Policy: the Company currently pays an annual 9.06p per ordinary share dividend in equal quarterly
installments, which equates to a dividend yield of over 9.7% based on the Company’s ordinary share price as at
31 March 2023.
Profit Distribution Policy: the Company currently distributes 50% of investment profits as and when realised to
ordinary shareholders, to the extent this has not been returned already through dividends or buy-backs.
Further information on these policies is provided below.
Realisation Classes: every 5 years the Company allows ordinary shareholders to convert their shares into a new
series of realisation shares. On disposal of an investment, save for reasonable working capital requirements, all
proceeds are returned directly to shareholders allowing them to ultimately receive 100% of the underlying NAV.
The next Realisation Class Offer will be made available to ordinary shareholders in November 2026.
The Board believe that the combination of these measures provides a substantial mitigant to a persistent discount
to NAV and ultimately provides shareholders with potentially substantial returns of capital as demonstrated by the
data below.
Capital Distributions, NAV and Discount
Management
Realisation Shares
Capital Returns and Distributions Since Inception
Realisation
Class
2016
2021
9
MVIR
MVR2
+31.5%
+0.8%
376.0p
185.3p
£3.5m
£0.7m
84.6%
0.0%
Ticker Shareholder
Total Return
7
Nav
Per share
Net Assets NAV
Distributed
SINCE INCEPTION
8
For the year ended 31 December 2022
Dividends
and
Buybacks
10
£58.3m
Capital
Returns
£25.9m
Total
Distributions
£84.2m
Total Capital
Returns
£15.6m
Dividends
and
Buybacks
£58.3m
Capital
Returns
£41.5m
Total since
inception
£99.8m
Ordinary Shares CombinedRealisation
Classes
7
Shareholder total return is calculated as the movement in total shareholder value, including all distributions made to realisation
shareholders over the relevant period
8
Calculated as total distributions as a percentage of Net Assets on creation of each class
9
2021 Realisation Class performance is calculated for the period from creation of the class on 30 November 2021
10
Includes the dividend paid to ordinary shareholders in February 2023
32
|
Ordinary Share Distribution Policy
The Company’s Ordinary Share Distribution Policy is comprised of two parts:
1. Minimum annual return
Policy
The Company will deliver a minimum annual return to Shareholders by making distributions in each quarter. Pursuant
to the Ordinary Share Distribution Policy, in each year the Minimum Annual Distribution will be maintained or grown
on a pence per share basis.
In circumstances where the Board decides to make a dividend payment which cannot be funded by income received
by the Master Fund or MVI II LP, the Master Fund may make distributions from the capital attributable to Ordinary
Share Interests to enable the Company to meet its obligations.
Any distribution of the minimum annual return may be made by way of:
(i) repurchases of ordinary shares;
(ii) by payment of dividends; or
(iii) a combination of both.
Implementation
Following consultations with the Company’s significant shareholders on the implementation of this policy, the Board
determined that, from the start of 2021, the most suitable method to satisfy the minimum distribution was through
the payment of dividends rather than through the Company’s share repurchase programme which had commenced
in 2018. Interim dividends of 2.265p per ordinary share were paid in February, May, August, and November 2022,
each being a total payment of £1,256,857. These payments have continued in 2023, with an interim dividend of
2.265p per ordinary share paid in February 2023.
2. Returns following Net Capital Gains
Policy
Where the Master Fund or MVI II LP disposes of an asset for a Net Capital Gain and the Company has not already
returned to ordinary shareholders an aggregate amount since 19 November 2013 in excess of 50 per cent of that
gain and any previous such gains pursuant to the Ordinary Share Distribution Policy (Minimum Annual Distribution
payments referred to above are treated as if they had been returns of gains for this purpose), the Master Fund will
distribute the difference to the Company. The Company will, in turn, make a corresponding distribution to ordinary
shareholders by way of tender offers, share repurchases or other returns of capital and distributions. Any share
repurchases may alternatively be made by the Master Fund and cancelled using the Exchange Procedure described
in the Company’s prospectus dated 19 October 2016. Returns following a Net Capital Gain may also be made by way
of an extraordinary distribution, where applicable, by adding such amount to the next proposed quarterly dividend (if
any), where doing so would not result in a delay as compared to declaring an extraordinary distribution.
The balance of any Profitable Realisation, after the payment of any incentive allocation, will be retained in the Master
Fund and available for new and follow-on investments and to meet the Master Fund’s reasonable working capital
requirements, although all or part of the balance may be used to augment distributions under the Ordinary Share
Distribution Policy. There is no adjustment, or offset, of any Net Capital Gains for any investments realised at a loss.
Implementation
Since the last distribution of Net Capital Gains made under this section 2 of the Ordinary Share Distribution Policy
following the disposal of the investment in Entertainment One, a total of over £46.5 million has been returned to
ordinary shareholders (including the February 2023 dividend) compared to realised gains attributable to ordinary
shareholders totaling £34.2 million (50% of which is £17.1 million). Accordingly, the Company has, to date, distributed
£29.4 million in excess of what would be required under this policy, and realised gains attributable to ordinary
shareholders in excess of £58.8 million will be needed before any return on a Profitable Realisation is made.
Since implementation in November 2013, over £73.5 million has been returned to shareholders under the Ordinary
Share Distribution Policy.
For the avoidance of doubt, the Company’s Ordinary Share Distribution Policy applies only to the ordinary shares.
The 2016 realisation shares and 2021 realisation shares carry no rights to participate in the Company’s Ordinary
Share Distribution Policy.
Capital Distributions, NAV and Discount
Management
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Fund Structure and Investment Policy
Status and Activities
The Company is a closed-ended investment company
registered by way of continuation in the Cayman
Islands (registered number MC-228005). The rights of
shareholders are governed by Cayman law and the
Articles. These rights may differ from the rights and
duties owed to shareholders in a UK incorporated
company.
The Company was admitted to trading as a closed-
ended investment company on the Specialist Fund
Market (the precursor to the Specialist Fund Segment)
on 8 December 2008.
Fund Structure
The Company is a feeder fund which has invested
substantially all of its assets into limited partnership
interests in the Master Fund. The Company has no
redemption rights for its investment in the
Master Fund.
The Master Fund has invested in a second master
fund, MVI II LP, a private equity fund structure
through which the majority of the Master Fund’s
investments attributable to ordinary shareholders
are made. Assets attributable to the 2016 realisation
shareholders and 2021 realisation shareholders
(each a “realisation pool”) are held directly by the
Master Fund. A look-through breakdown of the NAV
attributable to the ordinary, 2016 realisation and 2021
realisation shareholders along with ownership of the
assets is detailed in the Allocation of Net Asset Value
section of this Annual Report.
The structure of the Marwyn Funds, as detailed in the
structure chart below has evolved since inception to
provide access to a wider investor base. The Company
was added as a feeder to the Master Fund to allow
access to public market investors through
the Company’s listing on the SFS and MVI II LP
was launched to provide access to private equity
investor capital.
The Portfolio Company investments of MVI II LP are held by MVI II Holdings I LP, which aggregates
the investments of MVI II LP and its stapled co-investment vehicle, MVI II Co-Invest LP.
Marwyn Value Investors Limited
Listed on Specialist Fund Segment
of the London Stock Exchange
Marwyn Value Investors LP “The Master Fund”
Marwyn Value Investors II LP
“MVI II LP”
2016 Realisation
Shares
Ordinary
Shares
“2016 Realisation Pool”“Main Partnership” “2021 Realisation Pool”
Direct Portfolio Company
Investment
Direct Portfolio Company
Investment
Silvercloud Holdings Limited
(Le Chameau)
2021 Realisation
Shares
100% of 2021
Realisation Pool
100% of 2016
Realisation Pool
˜
97% Main
Partnership
˜
83% Main
Ownership
Portfolio Company Investment
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Fund Structure and Investment Policy
Investment Objective
The investment objective of the Company is to
maximise total returns primarily through the capital
appreciation of its investments.
Investment Policy
There are no investment restrictions applicable to the
Company or the Master Fund.
MVI II LP has the following investment restrictions:
• no investment can exceed 30% of the MVI II LP
limited partners’ aggregate commitments at the
time of investment;
• it cannot engage in derivative trading except to
hedge or enhance an investment in an existing
or prospective Portfolio Company;
• it cannot invest in any blind-pool investment
fund; and
• it may recycle distributed capital, up to an
amount equal to 100% of the partners’ aggregate
commitments, which may only be used to
acquire assets, and not pay fees.
The Master Fund and MVI II LP invest either directly
or indirectly into the Portfolio Companies. The Master
Fund (with the exception of the classes attributable
to realisation shareholders) and MVI II LP (during its
investment period being five years from the final close
on 31 March 2019) are permitted to make follow-on
investments into the Portfolio Companies and invest
in new Portfolio Companies. In the case of capital
relating to the Company’s realisation shares, the
Master Fund is only permitted to invest cash in follow-
on investments in the Portfolio Companies within
three years of creation of a realisation class which for
the 2016 Realisation Class expired in November 2019
and for the 2021 Realisation Class runs to November
2024.
The Master Fund also has an express power to use
cash to acquire the Company’s shares at a discount to
their NAV for cancellation. Any such acquisitions and
cancellations will be NAV enhancing for the continuing
holders of ordinary shares. The use of such power is
periodically reviewed by the Manager and the Board.
The assets attributable to a realisation pool are
managed with a view to maximising investment
returns, realising investments and making
distributions to the holders of the relevant class of
realisation shares as realisations are made.
A realisation pool is permitted to invest cash allocated
to it upon its creation in follow-on investments into
existing Portfolio Companies made within three years
of the creation of the realisation pool. Unlike the
investment policy in respect of the assets relating to
ordinary shareholders, cash generated on the sale
of an investment in a realisation pool may not be
re-invested and is, subject to amounts held back for
reasonable working capital requirements, distributed
to the relevant class of realisation shareholders.
Portfolio Company Costs
Entities within the Marwyn group may provide
services to the Portfolio Companies indirectly invested
in by the Company. These services include, but are not
limited to, corporate finance advisory, transactional
support, company secretarial, administrative and
accounting services.
Fees for any services provided are negotiated and
agreed with the independent management teams
operating each Portfolio Company (once appointed)
and are in accordance with any regulatory or
corporate governance requirements, as applicable.
There is no obligation for any Portfolio Company to
use the services offered by the Marwyn group and
third party service providers could be, and frequently
are, used.
Due to the shareholdings that the Marwyn Funds have
in the Portfolio Companies and directorships that
the Marwyn principals have on their boards, Marwyn
group entities are invariably considered to be ‘related
parties’ to the Portfolio Companies and as such, all
fees payable to Marwyn entities are fully disclosed in
the Portfolio Companies’ audited accounts, with all
contracts deemed ‘significant’ also being disclosed
in any Portfolio Company admission document or
prospectus.
The Portfolio Company costs indirectly borne by the
Company are proportional to the Company’s indirect
holding in each Portfolio Company. The holding in
each as at the balance sheet date is disclosed in the
Look-through portfolio information section of this
Annual Report.
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Report of the Directors
The Directors who served during the year and to the date of this report were:
Robert Ware
CHAIRMAN
Martin Adams
SENIOR INDEPENDENT
DIRECTOR
The Directors submit their Annual Report and the audited
financial statements for the year ended 31 December 2022
Victoria Webster
INDEPENDENT
NON-EXECUTIVE DIRECTOR
Peter Rioda
INDEPENDENT
NON-EXECUTIVE DIRECTOR
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Report of the Directors
Robert Ware
(Non-Executive Chairman)
Committee membership:
Nomination Committee – Chairman
Date of appointment: 3 October 2006
Robert qualified as a member of the Institute of Chartered
Accountants in England and Wales with Peat Marwick. He
served as a Director of Development Securities PLC between
1988 and 1994, filling the roles of Joint Managing Director and
Finance Director in the latter stage of his tenure.
Robert served first as corporate development director and
then as deputy chief executive of MEPC between June 1997
and June 2003. MEPC was the fourth largest property company
quoted on the LSE until September 2000, when Leconport
Estates, a company jointly owned by clients of Hermes
Pensions Management Limited and GE Real Estate, took the
company private. During his tenure at MEPC, Robert and the
team realised over £6 billion of international properties and
invested over £2 billion, mainly in the UK. Prior to joining
MEPC, Robert served as a director of Development Securities
plc between 1988 and 1994.
Robert is currently chief executive officer of The Conygar
Investment Company PLC, an AIM quoted property investment
and development company formed in 2003 by Robert and
members of the ex-MEPC team.
The Nomination Committee’s considerations on Robert’s
tenure are included in the ‘Nomination Committee’ section of
the Report of the Directors.
Martin Adams
(Senior Independent Non-Executive Director)
Committee membership:
Aud t Comm ttee – Member
Nomination Committee – Member
Remuneration Committee – Chairman
Date of appointment: 8 May 2015
Martin has served for over 30 years in executive and non-
executive capacities, both as chairman and director of over
20 closed-end funds and fund-invested operating companies
listed on European stock exchanges; and on the boards of
fund management companies. His investment experience
encompasses private equity, property, infrastructure and
renewables assets, predominantly in Asia and Europe. Prior
to serving on the boards of listed funds, he founded Vietnam
Fund Management Company, raised and managed the first
institutional investment fund for Vietnam and has been
involved as a director, manager or sponsor of 11 investment
funds and managers in Vietnam.
Martin is currently the Chairman of Eastern European
Property Fund Limited and a non-executive director of
National Investment and Infrastructure Fund Limited in India
and Metage Funds Limited. He started his career with the
Lloyds Bank group, where he was based in the UK, Hong Kong,
Portugal and the Netherlands.
In July 2020, Martin was appointed as Senior Independent
Director of the Company.
Peter Rioda
(Independent Non-Executive Director)
Committee membership:
Aud t Comm ttee – Member
Nomination Committee – Member
Remuneration Comm ttee – Member
Date of appointment: 9 July 2020
Peter is a qualified chartered accountant and independent
non-executive director with over 25 years of industry
experience who specialises in the establishment and
management of alternative investment funds. He successfully
established and developed Sanne Group’s fund administration
business between 2006 and 2016 exiting following its IPO in
2015. He has strong investment, risk management, governance
and compliance skills acquired through directorships on a
wide range of regulated and unregulated fund structures.
Peter is the independent non-executive chairman of Marwyn
General Partner II Limited (the general partner of MVI II
L.P.). Marwyn General Partner II Limited is not a Marwyn
operating company and is regulated by the Jersey Financial
Services Commission. It is a special purpose company whose
role is to act as a general partner to MVI II LP, the fund into
which the ordinary shares are ultimately invested. Peter’s
role as an independent director of Marwyn General Partner
II Limited provides him with insight on Marwyn’s investment
process. The Board considers that this provides increased
oversight and transparency into the investment structure
and enhances the role Peter plays on the Board, without
impugning his independence as a Director. As such, the Board
has determined him to be independent of Marwyn and any
shareholders of the Company.
Victoria Webster
(Independent Non-Executive Director)
Committee membership:
Audit Committee – Chairman
Nomination Committee – Member
Remuneration Committee – Member
Date of appointment: 9 July 2020
Victoria is a member of the Institute of Chartered
Accountants in England and Wales having qualified with
PriceWaterhouseCoopers. She has worked in Guernsey,
London and New York, specialising in the audit of alternative
investment funds. Victoria is the Managing Director of an
independent chartered accountancy practice, Cleland & Co.,
which specialises in owner-managed companies and regulated
entities across all sectors.
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Report of the Directors
Directors’ Interests
The Directors’ interests in the ordinary shares of the
Company were as follows as at 31 December 2022 and
31 December 2021.
Ordinary shares Ordinary shares
2022 2021
Robert Ware 500,000 700,174
Martin Adams 40,000 40,000
Peter Rioda 10,000 Nil
Victoria Webster Nil Nil
There has been no change in the Directors’ holdings
between 31 December 2022 and the date of approval of
these financial statements.
The Directors’ interests in both the 2016 realisation
shares and 2021 realisation shares of the Company were
nil as at 31 December 2022 (2021: nil) and to the date of
the approval of these financial statements.
The Board has put in place measures to ensure that the
requirements of MAR are adhered to.
Results
The results attributable to the shareholders for the
year are shown in the Statement of Comprehensive
Income.
Share Capital
As at 31 December 2022, the Company had 55,490,360
ordinary shares in issue (2021: 55,490,360), 933,070
2016 realisation shares in issue (2021: 933,070), and
360,482 2021 realisation shares (2021: 360,482).
Manager
The Manager is responsible for the implementation of
the investment policy of the Company and has overall
responsibility for the management of the investments
of the Company. The Manager reports to the Board
at each quarterly Board meeting regarding the
performance of the Company’s investment portfolio,
which provides the Board with an opportunity
to review and discuss the implementation of the
investment policy of the Company. The Board
reviewed and evaluated the performance of the
Manager during the year to 31 December 2022 and
having considered the role that the Manager performs
across the Marwyn Funds, has determined that the
Company’s appointment of the Manager remains
appropriate.
The management agreement governing the
Company’s appointment of the Manager allows for the
investment strategies that the Manager may employ
to be in any securities, instruments, obligations,
guarantees, derivative instrument or property of any
nature in which the relevant vehicle is empowered to
invest and as contemplated by its investment policy.
The Manager is entitled to a management fee,
payable by the Company in arrears, equal to 1/12th
of 2% per month of the NAV from the Company
where such investment is not in the Master Fund.
As the Company’s investments are all through the
Master Fund, the Company does not currently pay a
management fee to the Manager and will not do so
for as long as all investments are through the Master
Fund.
The Manager receives a management fee from the
Master Fund, payable monthly in arrears, equal to
1/12th of 2% of the NAV before management fees
and incentive allocations in respect of Class F, Class
R(F)1, Class R(G)1 and Class R(F)2 interests of the
Master Fund into which the Company invests. From
30 November 2018, being 2 years after the creation of
the 2016 realisation pool, the management fee on the
2016 realisation share interests (being Classes R(F)1
and R(F)2) is calculated by reference to NAV before
management fees and incentive allocation less the
aggregate value of cash and near cash investments
attributable to the realisation share interests. From
30 November 2023, being 2 years after the creation of
the 2021 realisation pool, the same calculation will be
applied to the management fee on the 2021 realisation
share interests.
Directors’ Remuneration
The emoluments of the individual
Directors for the year were as follows:
2021
£
50,000
45,000
35,000
35,000
165,000
2022
£
50,000
45,000
35,000
35,000
165,000
Robert Ware
Martin Adams
Peter Rioda
Victoria Webster
Directors’ fees are paid directly from the Master Fund.
The above fees do not include reimbursed out-of-pocket
expenses.
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Report of the Directors
The Manager may, at its discretion, pay from the
management fee to any person to which it has
delegated any of the functions it is permitted to
delegate. Aztec Financial Services (Jersey) Limited
as administrator to the Master Fund, calculates
the management fee payable to the Manager by
the Master Fund. The Manager is also entitled to
reimbursement of certain expenses incurred by it in
connection with its duties. The Company does not pay
any management fee or carried interest charge as a
result of its indirect investment in MVI II LP through
the Master Fund.
Incentive Allocation
Incentive allocations are due from the Master Fund in
respect of interests in Class F, Class R(F)1, Class R(G)1
and Class R(F)2 into which the Company invests. These
incentive allocations are only payable on returns being
made to shareholders as disclosed in Part II, section 6
of the Company’s most recent prospectus published
on 19 October 2021. This prospectus is available on
the Company’s website.
The incentive allocations are deducted from the
Gross Asset Value of the Master Fund in deriving the
NAV. The NAV is used to calculate the value of the
Company’s holding in the Master Fund.
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39
Report of the Directors
Marwyn Management and Employees
of which, individual holding above 3%
Marwyn Long Term Incentive LP
Other shareholders holding less than 3%
Armstrong Investments Limited
Pula Investments Limited
Cenkos CI Limited
1607 Capital Partners, LLC
Barclays Funds Investments Limited
Octopus Investments Limited
Charles Stanley & Co
Crux Asset Management Limited
Marwyn Management and Employees
of which, individual holding above 3%
Marwyn Long Term Incentive LP
Other shareholders holding less than 3%
Armstrong Investments Limited
Pula Investments Limited
Cenkos CI Limited
1607 Capital Partners LLC
Barclays Funds Investments Limited
Premier Fund Managers Limited
Octopus Investments Limited
Charles Stanley & Co
Crux Asset Management Limited
Quai Trustees Limited
5,552,243
4,659,133
893,110
10,840,000
4,500,000
3,937,257
3,504,653
3,409,090
2,740,000
2,499,866
2,424,000
5,552,243
4,659,133
893,110
10,840,000
4,500,000
3,907,275
3,709,653
3,409,090
2,850,166
2,740,000
2,480,231
2,424,000
1,747,103
9.78
8.21
1.57
19.09
7.92
6.93
6.17
6.00
4.83
4.40
4.27
9.78
8.21
1.57
19.09
7.92
6.88
6.53
6.00
5.02
4.83
4.37
4.27
3.08
Substantial Shareholdings
At 31 December 2022 the Company was aware of the following interests in 3% or more of the total voting rights
of the Company.
At 31 March 2023 the Company was aware of the following interests in 3% or more of the total voting rights
of the Company.
NUMBER OF SHARES
NUMBER OF SHARES
PERCENTAGE OF
TOTAL VOTING RIGHTS
PERCENTAGE OF
TOTAL VOTING RIGHTS
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Report of the Directors
Auditor
Baker Tilly Channel Islands Limited (“BTCI”) was
appointed by shareholder resolution at the first AGM
following their appointment on 3 December 2020.
BTCI has expressed its willingness to continue to act
as auditor to the Company and a resolution for its
re-appointment will be proposed at the forthcoming
AGM. Audit fees for the year ended 31 December 2022
for the Company total £24,550. No non-audit services
were provided by BTCI for the Company or any of the
Company’s associated underlying fund entities in
the year.
The Audit Committee does not have any reason to
believe that BTCI did not conduct an effective audit.
Expenses
All Company-related expenses are paid by the Master
Fund and allocated to the relevant Master Fund class
interest as described in Note 3.8 to the financial
statements.
A summary of costs ultimately incurred by both the
ordinary shareholders and realisation shareholders is
included in the ‘Key Information Documents’, located
on the ‘Documents’ section of the Company’s website,
www.marwynvalue.com.
Annual General Meeting
The notice of the AGM will be issued separately to
shareholders in due course.
Corporate Governance
As a company registered in the Cayman Islands and
subject to the rules of the Specialist Fund Segment,
the Company is not required to comply with the
UK Corporate Governance Code published by the
Financial Reporting Council.
The Directors, however, recognise the importance
of maintaining sound corporate governance that
meet the listing requirements and so seek to ensure
that the Company adopts a framework for corporate
governance, including policies and procedures which
reflect those principles of good corporate governance
that are appropriate to the Company’s size and
status as an investment company and are in line with
the best practices in relation to matters affecting
shareholders, communities, regulators and other
stakeholders of the Company.
The Company is a member of the AIC and the Board
has considered the principles and recommendations
of the AIC Code.
The AIC Code sets out a framework of best practice in
respect of the governance of investment companies.
It has been endorsed by the UK Financial Reporting
Council. The AIC Code is available on the AIC’s website
(www.theaic.co.uk).
The Board considers that reporting against the
principles and provisions of the AIC Code provides the
most relevant information to shareholders given that
the Company is an externally managed investment
company.
Apart from establishing an Internal audit function
and complying with the requirements for the Board
composition and the re-election of the Directors as
set out in this report, the Company has complied with
the principles and provisions of the AIC Code.
Board Composition and Meetings
The Chairman, Robert Ware, is not considered to be
independent due to his tenure as Chairman and him
having interests in, and having other directorships
within, the Marwyn group. As detailed more fully
in the ‘Nomination Committee’ section later in the
Report of the Directors, the Nomination Committee
believes that Robert’s high level and range of business
knowledge, financial experience and integrity enables
him to provide clear and effective leadership and,
in conjunction with his fellow Directors, proper
stewardship of the Company. The Company’s
independent non-executive Directors are of the
view that Robert’s position as Chairman ensures the
smooth running of the business and a co-operative
and aligned relationship with the Manager.
Martin Adams, Peter Rioda and Victoria Webster
are considered to be independent in terms of their
respective directorships. Whilst Martin Adams and
Peter Rioda have a beneficial interest in the Company
as detailed in the ‘Directors’ Interests’ section of
this report, this is not considered to impugn on
their independence, and serves to further align the
interests of the Directors with those of shareholders.
Martin Adams is the Company’s senior independent
director, providing a sounding board for the Chairman
and serving as an intermediary for the other Directors
and shareholders. He is also responsible for leading
the annual appraisal of the Chairman’s performance.
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Report of the Directors
The Board has adopted a policy on tenure which
requires the Nomination Committee to annually
consider the appropriateness of the tenure of the
Chairman and each Director alongside the skills,
experience and knowledge the Directors bring to
the Board, as detailed in the Nomination Committee
section of this report. In line with the guidance
provided by the AIC Code, the Board recognises
that whilst the Company should benefit from a
regular infusion of new appointments to the Board
(demonstrated by the 2020 appointments of Peter
Rioda and Victoria Webster), investment companies
are more likely, compared to other companies,
to benefit from having at least one director with
considerably longer experience. This is the case with
Robert Ware, the Chairman, who has served on the
Board for more than nine years. The relevant criteria
when assessing the board composition include
continuity, self-examination and the ability to do
the job.
One-third, or the nearest number to one-third, of
the Directors shall retire and offer themselves for
re-appointment at each AGM in accordance with the
Articles, facilitating the Board’s stability and decision
making ability. All Directors are re-elected at the next
AGM following their appointment and thereafter retire
by rotation, subject also to the requirement that all
Directors are required to offer themselves for re-
election at least every three years.
The Board meets on a quarterly basis to consider,
among other things, the investment performance
and associated matters, such as marketing and
investor relations, risk and portfolio management,
the suitability of the investment policy, performance
of the share price as well as NAV performance and
any discount between the share price and the NAV,
the shareholder profile of the Company and the
performance and cost of service providers, to ensure
control is maintained over the Company’s affairs.
Regular ad hoc informal meetings are also held with
the Manager principally to review the performance
of the investments and material events affecting the
Company. The Company Secretary is responsible
for distribution of board papers in a timely manner
at least seven days prior to the Board or committee
meetings. The Board ensures that the information
received for the board or committee meetings are
of an appropriate quality to enable it to discharge its
responsibilities.
The Directors bring both significant funds and
professional expertise and commercial operating
experience, having managed businesses across a
wide range of industries and economic environments.
The Board consists of a majority of independent
non-executive Directors. The Chairman, in his role
of leading the Board, managing Board meetings, and
encouraging constructive challenge between Board
members is central to setting the tone from the
top. The Board meets frequently, both formally and
informally, and across all means of communication,
which fosters openness and honesty. This is mirrored
in the relationships the Board has developed with
the Company’s service providers. The Directors have
access to the advisers of the Company and where
deemed necessary to discharge their responsibilities
properly, may seek independent professional advice
at the Company’s expense.
The Board meets regularly with the Manager
throughout the year at each quarterly board meeting
and at any ad hoc Board or informal meetings held
dependent on the investment activity of the funds
through which the Company directly or indirectly
invests. The Board provides constructive challenge
as well as honest and frank feedback on significant
portfolio activity, contributing independent
viewpoints and scrutiny to the investment process.
The Board also conveys shareholder feedback to the
Manager ensuring the interests of shareholders as a
whole are a primary consideration for all investment
decisions. The Board-level governance arrangements
and relationship with the Manager facilitate the
sustainability of the Company’s business model and
investment strategy.
The Board evaluates its performance through
completion of annual confidential questionnaires
with the results reported to the Nomination
Committee. The Board also considers the tenure and
independence of each Director, at least annually, via
discussions at the Nomination Committee meetings.
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Report of the Directors
Culture
The Board is acutely aware that the Company’s culture
needs to clearly align with the Company’s purpose,
value, and strategy. The Company is small and, as at
the date of these financial statements, consists of four
Directors. The Company culture is therefore set by the
Board and demonstrated through Board interaction
and in turn the relationships the Board develops with
service providers and, in particular, the Manager.
Remuneration plays a role in impacting the Company’s
behaviour and culture. The Remuneration Committee
has reviewed the Company’s remuneration policy
and Director remuneration and are satisfied that
this is aligned with the Company’s culture, ensuring
that remuneration is at a level to attract individuals
of a calibre appropriate to the Company’s future
development, without compromising Director
independence.
Shareholder and Stakeholder Engagement
The Chairman regularly meets with representatives
of the Manager and is in regular communication with
his fellow Directors. In addition, the Board maintains
open and frequent communication with the Manager,
Administrator and Broker throughout the year so
that any ad hoc items for the Board’s consideration
are able to be considered in a timely manner by
all members of the Board. The Chair of the Audit
Committee has regular communication with the
auditor.
The Company welcomes the views of shareholders
and places great importance on communication with
its shareholders. The Chairman and the independent
Directors are always available for communication
with shareholders, with the Chairman and Senior
Independent Director regularly meeting with the
Company’s major shareholders and all shareholders
have the opportunity, and are encouraged, to attend
and vote at the AGMs of the Company, during which
the Board and the Manager will be available to
discuss issues affecting the Company. The Board is
regularly informed of shareholders’ views via updates
from the Manager and Broker as to meetings and
other communications they may have had with
shareholders.
Key Service Providers
The Board is responsible for reviewing all major
service providers of the Company annually which
includes the Manager. At the Board Meeting of the
Company in December 2022, the Board assessed and
reviewed the performance of all key service providers.
Following the changes to various key service providers
in 2020, the Board considers that the current
arrangements are appropriate for the Company
and the continued appointments of all key service
providers have been approved by the Board.
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Report of the Directors
Board Committees
The Company uses a number of committees to
manage its operations. Each committee has formal
written terms of reference, which clearly define their
responsibilities and are reviewed and reassessed
for their adequacy on an annual basis. The terms of
reference of each committees are available on the
Company’s website.
Audit Committee
The Audit Committee comprises all the independent
non-executive Directors and meets at least twice a
year. As Robert Ware is a chartered accountant and
has significant investment company experience, the
Board values his input and so he is ordinarily invited
to attend committee meetings as an observer. Victoria
Webster, a chartered accountant, is Chairman of the
Audit Committee. The Audit Committee provides
a forum through which the Company’s auditor has
access to and can report to the Board. Its functions
relate to the Company only and do not apply to the
Master Fund, MVI II LP or any other vehicle.
The Audit Committee has no reason to consider the
auditor to be non-independent and will continue to
review the relationship and assess independence.
The Audit Committee performs the following
functions:
• selection of the statutory auditor and making
recommendations relating to the appointment
of the statutory auditor to the Board;
• monitoring the financial reporting (including
cash and securities reconciliations) process and
submitting recommendations or proposals to
the Board in order to ensure the integrity of that
process;
• monitoring the statutory audit of the
Company’s annual financial statements and the
performance of the Company’s auditor, taking
into account any findings and conclusions by the
Financial Reporting Council under article 26 (6) of
Regulation 538/2014 (the “Audit Regulation”);
• reviewing and monitoring auditor independence
in accordance with paragraphs 2(3), 2(4), 3 to
8 and 10 to 12 of Schedule 1 to the Statutory
Auditors and Third Country Auditors Regulations
2016 (SI 2016/649) and article 6 of the Audit
Regulation, and in particular the appropriateness
of the provision of non-audit services to the
issuer in accordance with article 5 of the Audit
Regulation;
• informing the Board of the outcome of the
statutory audit and explaining how the statutory
audit contributed to the integrity of the financial
reporting process and what role the Audit
Committee played in that process; and
• keeping under review the adequacy and
effectiveness of the Company’s internal
financial controls and internal control and risk
management systems.
Attendance Record:
The number of meetings which each Committee member is eligible to attend is shown below along with the
number of meetings held over the year or since the date of their appointment or prior to the date of their
resignation.
Director: Held Attended Held Attended Held Attended Held Attended
Robert Ware 4 4 2 2 2 2 2 2
Martin Adams 4 4 2 2 2 2 2 2
Peter Rioda 4 4 2 2 2 2 2 2
Victoria Webster 4 4 2 2 2 2 2 2
Remuneration
Committee
Nomination
Committee
Audit
Committee
Quarterly Board
Meetings
During the year a further 2 ad hoc Board Committee meetings and 1 ad hoc Audit Committee meeting were held to
deal with matters substantially of an administrative nature and these were attended by those Directors available.
Whilst Robert Ware is not a member of either the Audit or Remuneration Committees, he has been invited to, and
attended, each Audit Committee and Remuneration Committee meeting held in the year as a non-member.
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Report of the Directors
During the year, the Audit Committee met three times,
the key matters discussed included the review and
consideration of:
• the Audit Committee’s terms of reference;
• the Company’s annual financial statements for
the year ended 31 December 2021 and interim
financial statements for the six-month period
ended 30 June 2022, including review of the RNS
announcements released in connection with
these accounts;
• the independence of the auditor and the
effectiveness of the audit;
• the Company’s policy and procedures, including
compliance arrangements in relation to anti-
bribery and corruption and whistleblowing;
• the Company’s cash flow and reconciliation to
bank statements;
• the need for an internal audit function; and
• cash flow management and the payment control
system.
The Audit Committee concluded that an internal audit
function is not required as all of the Company’s day-
to-day management and administrative functions are
outsourced to regulated third parties.
Nomination Committee
The Nomination Committee comprises all the
Directors, resulting in a majority of the members of
the committee being independent non-executive
directors whilst retaining access to the knowledge and
experience of Robert Ware, who chairs the committee.
The committee meets at least twice a year. Members
of the Nomination Committee do not participate in the
review of their own position, and further, Robert Ware
will not chair a meeting of the Nomination Committee
when it is dealing with the matter of succession to the
chairmanship of the Board.
The function of the Nomination Committee is to
consider the appointment and re-appointment of
directors. When considering the appointment and re-
appointment of directors, the Nomination Committee
and the Board consider whether the Board and its
committees have a balance of skills, experience,
length of service, knowledge of the Company, its
diversity, how the Board works together and any other
factors relevant to the effectiveness of the Board
including if the director or candidate being reviewed
has sufficient time to devote to the Company to carry
out their duties effectively.
Formal induction training is provided to new Directors
on request. All new Directors meet with the Chairman,
the Senior Independent Director, members of the
Nomination Committee, the Manager and any other
relevant key advisers, prior to appointment in order to
discuss the Company, the Manager, the responsibilities
of a Director of the Company and investment company
industry matters.
Any new Directors will meet with the full Board at
the earliest opportunity following their appointment.
In addition, all Directors have full access to the
Administrator, Broker, Manager and legal counsel.
The Nomination Committee, on at least an annual
basis, considers the performance of the Board, along
with the tenure and independence of each Director. An
evaluation of the performance of the Board and the
Chairman was carried out in 2022 with no major issues
identified, however the Nomination Committee agreed
to look into succession planning for the Company going
forward. The committee believes there is a suitable
combination of experience, knowledge, and skills to
operate as an effective Board. The significant level
of shareholder engagement from the Chairman, the
Senior Independent Director and the two Independent
Directors has ensured shareholders views have been
fully understood by the Board and appropriate actions
have been taken. This has resulted in the Board working
alongside the Manager to amend the implementation
of the Company’s Ordinary Share Distribution Policy
and to add further detailed disclosure in these
accounts around governance, strategy and director
independence.
The committee recognises that the Chairman, Robert
Ware, has been a Board member since 2006 and is not
independent of the Manager but believe that the skills
and experience he brings to the Board significantly
outweigh any actual or potential conflicts arising from
his position. Robert has served as an independent
non-executive chairman of several listed investment
funds (and thus understands and respects the role of
the Company’s independent directors); he has a long
relationship with the Manager and their key personnel;
he has intimate knowledge of the Company’s corporate
history and long experience of running operating
businesses such as those held in the portfolio.
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Report of the Directors
These rare skills and experience in the context of the
Company combine to provide Robert the ability to
bridge the views and suggestions of the independent
directors with those of the Manager.
In any situation where the Chairman is conflicted,
or could be perceived to be conflicted, he abstains
from comment and vote and, in any case, the
independent Directors form a majority of the Board.
The independent Directors are of the view that, given
the structure of the Company and its management
arrangements, the Chairman is important to ensuring
the smooth operation of the business and it is in the
best interests of the Company and its shareholders
that Robert chairs the Company.
The Nomination Committee considers that the three
other Board members are all independent of the
Company and the Manager, as detailed in the ‘Board
Composition and Meetings’ section earlier.
The Nomination Committee ensures that the
Company remains aligned with best corporate
governance practices, especially with respect to the
increased focus on diversity. The Board acknowledges
the importance of diversity, including but not limited
to gender as part of the effective functioning of
the Board. The Nomination Committee evaluates
applicants to fill vacant positions fairly, and without
prejudice applicants will be assessed on their broad
range of skills, expertise and industry knowledge. The
Nomination Committee believes that the Board has
a range of experience, age, background and skills to
help create an environment of effective and successful
decision making. The Company does not employ any
staff. Meetings of the Nomination Committee are held
at least twice a year as a minimum.
During the year the Nomination Committee met twice,
the key matters discussed included the review and
consideration of:
• the Nomination Committee’s terms of reference;
• the annual Board and Chairman evaluations; and
• the structure, size and composition of the Board
and its committees.
In April 2023, in accordance with the Company’s
Articles, the Nomination Committee recommended
that Peter Rioda and Victoria Webster should be put
forward for re-election at the 2023 AGM.
During the year, the Nomination Committee’s terms
of reference were reviewed and it was deemed no
changes were required.
Remuneration Committee
The Remuneration Committee comprises all the
independent non-executive Directors and meets at
least twice a year. As with the Audit Committee, the
Board values Robert Ware’s input so he is ordinarily
invited to attend Remuneration Committee meetings.
Members of the Remuneration Committee do not
participate in the review of their own remuneration.
The Company’s remuneration policy is to set
remuneration at a level to attract individuals of
a calibre appropriate to the Company’s future
development. The maximum aggregate remuneration
of all of the Directors is £200,000 in accordance with
the Company’s Articles.
During the year the Remuneration Committee met
twice to discuss the Remuneration Committee’s terms
of reference and duties, the remuneration policy and
the structure and level of remuneration of the Board.
Following review and consideration of the Company’s
remuneration policy, the Remuneration Committee
concluded that the current remuneration policy of
the Company is set at a level to attract, motivate,
and retain individuals of a calibre appropriate to the
Company’s future development and that the structure
of the Company’s remuneration remains appropriate
for the size and the activities of the Company.
During the year, the Remuneration Committee’s terms
of reference were reviewed and it was deemed no
changes were required.
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Report of the Directors
Management Engagement Committee
The Board considers that due to the Company’s
size and its structure as a feeder fund, it would be
unnecessarily burdensome to establish a separate
management engagement committee. The review of
the performance of, and contractual arrangements
with, the Manager is undertaken by the Board.
However only Directors independent of the Manager
are involved with this review.
Authority of the Manager
The authority of the Manager is set out in writing
in the management agreement. Under the terms
of the management agreement the key duties of
the Manager are the negotiation of any investment,
consolidation disposal of an investment, in accordance
with the relevant investment policy. In performing
these services, the Manager is granted authority to:
• give instructions to administrators and sub-
administrators in relation to acquisitions and
disposals of investments;
• cause money to be retained in cash or placed in
deposit;
• negotiate contracts, agreements and other
undertakings as may be reasonable;
• instruct and appoint any advisors and specialists
which are believed necessary or advisable for
the purposes of implementing the investment
policy and/or managing the investments;
• use reasonable endeavours to obtain all
licences, permissions and consents necessary
to complete, maintain or dispose of any
investment;
• prepare all necessary documentation and where
necessary submit to the board for execution;
• borrow or raise monies as required;
• assist as necessary in the valuation of unlisted
investments;
• advise on availability and appropriate source of
funds to be utilised as distributions;
• carry out quarterly reviews of the investment
portfolio, or at any other time as directed by the
Company;
• prepare at least quarterly a report detailing
the activities and performance of the Manager
during the quarter; and
• monitor investment policy and propose changes
to the Board.
Any areas of decision making not under the authority
of the Manager remain the responsibility of the Board.
Statement of going concern
Under the relevant class agreements between the
Company and the Master Fund, the Master Fund is
required to meet the Company’s expenses and as
such, the Directors consider that there is no mismatch
between the Company’s assets and liabilities.
The Board and the Manager regularly consider and
assess the forecast cash position of the Master Fund
(including a reasonably possible forecast of portfolio
company investment and divestment). The Directors
continue to believe that the Company, via the Master
Fund, has sufficient resources to meet all liabilities as
they fall due for at least 12 months from the date of
approval of these financial statements and continue
to adopt a going concern basis in preparing the
financial statements.
Internal control
The Board is responsible for establishing and
maintaining the Company’s system of internal control
and risk management and reviewing its effectiveness.
Internal control systems are designed to meet the
particular needs of the Company and the particular
risks to which it is exposed.
The procedures are designed to manage rather than
eliminate risk and by their nature can only provide
reasonable but not absolute assurance against
material misstatement or loss. The key procedures
which have been established to provide effective
internal controls are as follows:
The duties of managing the investments and
accounting are segregated:
• Aztec Financial Services (Jersey) Limited, a
company independent of the Manager and the
Board, provide administrative and accounting
services to Company, the Master Fund and
MVI II LP;
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Report of the Directors
• custodian services are provided by an
independent party to the Master Fund and
are segregated from the administrative and
accounting services provided; and
• the Board reviews financial information
produced by the Manager and Aztec as
appropriate on a regular basis.
The Company does not have an internal audit function
as all of the Company’s management functions are
delegated to third parties and the Board therefore
considers that there is no need for the Company to
have an internal audit function. The Audit Committee
however reviews Aztec’s ISAE 3402 report and
considers any exceptions raised to assess the integrity
and robustness of the internal controls in place at
Aztec as the Company’s administrator.
The Audit Committee has reviewed the Company’s risk
management and control systems and believes that
the controls are satisfactory given the nature and size
of the Company.
Financial Risk Profile
The Company’s financial instruments comprise
investments, cash and various items such as payables
and receivables that arise directly from the Company’s
operations. The main purpose of these instruments is
the investment of shareholders’ funds. The main risks
are detailed in Note 12 to the financial statements and
in the Risk section.
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Report of the Directors
Directors’ Responsibilities
The Directors are responsible for preparing the financial statements in accordance with applicable law and
International Financial Reporting Standards as adopted by the European Union (“IFRS”).
The Directors are required to prepare financial statements for each financial year which give a true and fair view
of the state of affairs of the Company and of the profit or loss of the Company for that year and to confirm that
the reports contained in these financial statements includes a fair review of the performance of the business
and the position of the Company.
In preparing these financial statements the Directors are required to:
• select suitable accounting policies and apply them consistently;
• make judgements and estimates which are reasonable and prudent;
• state whether applicable accounting standards have been followed, subject to any material departures
disclosed and explained in the financial statements; and
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
Company will continue in business.
The Directors are responsible for keeping proper accounting records that disclose with reasonable accuracy
at any time the financial position of the Company and enable them to ensure that the financial statements
comply with Cayman law. They are also responsible for safeguarding the assets of the Company and hence
for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Directors
are responsible for the maintenance and integrity of the corporate and financial information included on the
Company’s website.
Each of the Directors, whose names and functions are listed on page 36, confirms that, to the best of their
knowledge:
• these financial statements, which have been prepared in accordance with IFRS, give a true and fair view of
the assets, liabilities, financial position and loss of the Company; and
• the reports contained in these financial statements includes a fair review of the development and
performance of the business and the position of the Company, together with a description of the principal
risks and uncertainties that it faces.
On behalf of the Board
Robert Ware Victoria Webster
Chairman Director
27 April 2023 27 April 2023
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Report of the Independent Auditor
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Report of the Independent Auditor
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Report of the Independent Auditor
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Report of the Independent Auditor
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Report of the Independent Auditor
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Income Statement
INCOME Revenue Capital Total Revenue Capital Total
Finance income 881 - 881 60 - 60
Distribution income 5,027,427 - 5,027,427 5,060,086 - 5,060,086
Net(loss)/gainonfinancial
assets measured at fair value
throughprofitorloss 6 - (2,980,912) (2,980,912) - 14,032,026 14,032,026
TOTAL NET INCOME / (LOSS) 5,028,308 (2,980,912) 2,047,396 5,060,146 14,032,026 19,092,172
EXPENSES
Finance cost and bank charges (881) - (881) (60) - (60)
TOTAL OPERATING EXPENSES (881) - (881) (60) - (60)
PROFIT/(LOSS) FOR THE YEAR 5,027,427 (2,980,912) 2,046,515 5,060,086 14,032,026 19,092,112
TOTAL COMPREHENSIVE
INCOME/(EXPENSE) 5,027,427 (2,980,912) 2,046,515 5,060,086 14,032,026 19,092,112
RETURNS PER SHARE
Attributable to holders
of ordinary shares 5,027,427 (3,825,876) 1,201,551 5,060,086 11,488,702 16,548,788
Weighted average ordinary
shares in issue for the year
ended 31 December 10 55,490,360 55,490,360 55,490,360 55,819,238 55,819,238 55,819,238
Return per ordinary share
- basic and diluted 9.06p (6.89)p 2.17p 9.07p 20.58p 29.65p
Attributable to holders of
2016 realisation shares - 839,392 839,392 - 2,521,902 2,521,902
Weighted average realisation
shares in issue for the
year ended 31 December 10 - 933,070 933,070 - 3,254,449 3,254,449
Return per 2016 realisation share
- basic and diluted - 89.96p 89.96p - 77.49p 77.49p
Attributable to holders of 2021
Realisation shares - 5,572 5,572 - 21,422 21,422
Weighted average 2021
realisation shares in issue
for the year ended 31
December 10 - 360,482 360,482 - 31,604 31,604
Return per 2021 realisation share –
basic and diluted - 1.55p 1.55p - 67.78p 67.78p
For the year ended 31 December 2022
Notes Year ended 31 December 2022 Year ended 31 December 2021
£ £
Notes 1 to 18 on pages 60 to 73 form an integral part of these financial statements.
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Statement of Financial Position
NON CURRENT ASSETS
Financialassetsmeasuredatfairvaluethroughprofitorloss 6 102,287,690 105,268,601
CURRENT ASSETS
Cash and cash equivalents 8 129,145 128,554
TOTAL ASSETS 102,416,835 105,397,155
CURRENT LIABILITIES
Loan payable 7 (125,000) (125,000)
Accruals (4,146) (3,554)
TOTAL LIABILITIES (129,146) (128,554)
NET ASSETS ATTRIBUTABLE TO EQUITY HOLDERS 102,287,689 105,268,601
CAPITAL AND RESERVES ATTRIBUTABLE
TO EQUITY HOLDERS OF THE COMPANY
Share capital 10 88 88
Share premium 10 61,455,770 61,455,770
Special distributable reserve 26,346,979 26,346,979
Exchange reserve 54,386 54,386
Capital reserve 3,159,948 3,159,948
Revenue reserve 11,270,518 14,251,430
TOTAL EQUITY 102,287,689 105,268,601
Net assets attributable to ordinary shares 98,111,816 101,937,692
Ordinary shares in issue at 31 December 55,490,360 55,490,360
Net assets per ordinary share 176.81p 183.70p
Net assets attributable to 2016 realisation shares 3,508,007 2,668,615
2016 realisation shares in issue at 31 December 933,070 933,070
Net assets per 2016 realisation share 375.96p 286.00p
Net assets attributable to 2021 realisation shares 667,866 662,294
2021 realisation shares in issue at 31 December 360,482 360,482
Net assets per 2021 realisation share 185.27p 183.72p
Notes 31 December 2022 31 December 2021
£ £
As at 31 December 2022
The financial statements on pages 56 to 73 were approved by the Board of Directors and authorised for issue
on 27 April 2023. They were signed on its behalf by:
Robert Ware Victoria Webster
Notes 1 to 18 on pages 60 to 73 form an integral part of these financial statements.
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Statement of Cash Flows
Cash flows from operating activities
(Loss) / gain for the year (2,980,912) 14,032,026
Loss/(gain)onfinancialassetsheldatfairvaluethroughprofitorloss 2,980,912 (14,032,026)
Interest received 881 60
Redemption of Class R(F) and Class R(G) interests in the Master Fund - 6,361,213
Distributions received on Class F interests in the Master Fund 6 5,027,427 5,060,086
Bank charges paid (145) (60)
Bank interest paid (736) -
Increase / (decrease) in accruals 591 (60)
Net cash inflow from operating activities 5,028,018 11,241,239
Cash flows used in capital transactions
Cash paid to 2016 realisation shareholders on redemption
of 2016 realisation shares - (6,361,213)
Dividends paid to ordinary shareholders 10 (5,027,427) (5,060,086)
Net cash flow used in capital transactions (5,027,427) (11,421,299)
Net increase / (decrease) in cash and cash equivalents 591 (60)
Cash and cash equivalents at the beginning of the year 128,554 128,614
Cash and cash equivalents at the end of the year 129,145 128,554
31 December 31 December
2022 2021
Notes £ £
For the year ended 31 December 2022
Notes 1 to 18 on pages 60 to 73 form an integral part of these financial statements.
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Statement of Changes in Equity
For the year ended 31 December 2022
Special
Share Share distributable Exchange Capital Revenue
Notes capital premium reserve reserve reserve reserve Total
£ £ £ £ £ £ £
Opening balance 88 61,455,770 26,346,979 54,386 3,159,948 14,251,430 105,268,601
Dividends paid to ordinary shareholders - - - - - (5,027,427) (5,027,427)
Totalcomprehensiveincomefortheyear - - - - - 2,046,515 2,046,515
Closing balance 88 61,455,770 26,346,979 54,386 3,159,948 11,270,518 102,287,689
For the year ended 31 December 2021
Special Special
Share Share distributable Exchange Capital Revenue
Notes capital premium reserve reserve reserve reserve Total
£ £ £ £ £ £ £
Opening balance 91 64,436,254 26,346,979 54,386 (4,976,238) 11,736,316 97,597,788
Dividends paid to ordinary shareholders - - - - - (5,060,086) (5,060,086)
Redemption of 2016 realisation shares 10 (3) (2,980,484) - - (3,380,726) - (6,361,213)
Transferofrealisedlossestorevenuereserve - - - - (2,515,114) 2,515,114 -
Totalcomprehensiveincomefortheyear - - - - 14,032,026 5,060,086 19,092,112
Closing balance 88 61,455,770 26,346,979 54,386 3,159,948 14,251,430 105,268,601
Notes 1 to 18 on pages 60 to 73 form an integral part of these financial statements.
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Notes to the Financial Statements
1. General information
Marwyn Value Investors Limited (the “Company”) is a closed-ended investment fund registered by way of continuation in
the Cayman Islands (registered number MC-228005) and is traded on the Specialist Fund Segment of the London Stock
Exchange. The rights of the shareholders are governed by Cayman law and may differ from the rights and duties owed to
shareholders in a company incorporated in England and Wales. The address of its registered office is PO Box 309, Ugland
House, Grand Cayman, KY1-1104, Cayman Islands.
The Company is a feeder fund which has invested substantially all of its assets into limited partnership interests in the
Master Fund. The Company has no redemption rights for its investment in the Master Fund.
The Master Fund has invested in a second master fund, MVI II LP, a private equity fund structure through which the
majority of the Master Fund’s investments attributable to ordinary shareholders are made. Assets attributable to the
realisation shareholders are held directly by the Master Fund.
2. New standards and amendments to IFRS
The following standards and amendments to existing standards, which are effective for annual periods beginning on or
after 1 January 2022 have had no impact on the Company’s financial position or results:
Revised conceptual framework and amendments Effective Date
Amendments to IFRS 3 – Reference to the Conceptual Framework 1 January 2022
Amendments to IAS 16 – Property, Plant and Equipment – Proceeds before intended use 1 January 2022
Amendments to IAS 37 – Provisions, Contingent Liabilities and Contingent Assets 1 January 2022
2.1 New standards, amendments and interpretations not yet effective
The following standards and amendments are effective for annual periods beginning on or after 1 January 2023 and have
not been early adopted in preparing these financial statements. The Company has considered the impact of these and
concluded that none of these are expected to have a significant effect on the financial position or results of the Company.
Standard
IFRS 17 – Insurance Contracts 1 January 2023
Amendments to IAS 8 – Accounting Policies, Changes in Accounting Estimated and Errors 1 January 2023
Amendments to IAS 1 – Presentation of Financial Statements 1 January 2023
Amendments to IFRS 17 – Insurance Contracts 1 January 2023
Amendments to IAS 12 – Income Taxes 1 January 2023
Amendments to IAS 1 – Presentation of Financial Statements 1 January 2024
Amendments to IFRS 16 – Lease Liability in a Sale and Leaseback 1 January 2024
3. Summary of significant accounting policies
The principal accounting policies, which have been consistently applied in the preparation of these financial statements,
are set out below.
3.1 Basis of preparation and going concern
The financial statements have been prepared under the historical cost convention on a going concern basis, as modified
by the revaluation of financial assets measured at fair value through profit or loss.
Under the relevant class agreements between the Company and the Master Fund, the Master Fund is required to meet
the Company’s expenses and as such, the Directors consider that there is no mismatch between the Company’s assets
and liabilities.
Considering the significant cash balance held by the Master Fund, the Directors believe that the Company, via the Master
Fund, has sufficient resources to meet all liabilities as they fall due for at least 12 months from the date of approval of
these financial statements and continue to adopt a going concern basis in preparing the financial statements.
3.2 Statement of compliance
The financial statements of the Company have been prepared in accordance with IFRS together with the applicable legal
and regulatory requirements of Cayman law.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting
estimates and judgements. It also requires the Board of Directors to exercise its judgement in the process of applying
the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the financial statements, are disclosed in Note 4.
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Effective Date
Notes to the Financial Statements
The SORP issued in July 2022 by the AIC seeks to best reflect the activities of an investment company. Where the
SORP contains recommendations applicable to the Company and involving material balances, its recommendations
have been incorporated in these financial statements.
3.3 Foreign currency translation
(a) Functional and presentation currency
Items included in the financial statements of the Company are measured using the currency of the primary economic
environment in which the entity operates (the functional currency). In arriving at the functional currency, the
Directors have considered the currency in which the original capital was raised, any distributions that may be made
and ultimately the currency that the capital would be returned in on a break up basis.
The Directors have also considered the currency to which the underlying investments are exposed. The Directors
are of the opinion that Sterling best represents the functional currency and therefore the financial statements are
presented in Sterling.
(b) Transactions and balances
Foreign currency transactions are translated into Sterling using the exchange rates prevailing at the dates of the
transactions. Foreign currency assets and liabilities are translated using the exchange rate prevailing at the Statement
of Financial Position date. Foreign exchange gains and losses arising from translation are included in the Income
Statement.
Non-monetary assets and liabilities that are measured at historic cost in a foreign currency are not retranslated.
3.4 Financial assets measured at fair value through profit or loss
Classification
The Company’s investment in the Master Fund was designated by the Board at fair value through profit or loss
at inception as it is not held for trading but is managed, and its performance evaluated, on a fair value basis, in
accordance with the Company’s documented investment strategy.
The Company’s business model was re-assessed on adoption of IFRS 9 – Financial Instruments – on 1 January 2018.
As the investment in the Master Fund is not held for trading and the Company did not irrevocably elect, at transition,
to classify the investment as a financial asset measured at fair value through other comprehensive income, the
investment continues to be held as a financial asset measured at fair value through profit or loss under IFRS 9.
Changes in the fair value of investments measured at fair value through profit or loss are recognised in the Capital
column of the Income Statement. On disposal, realised gains and losses are also recognised in the Capital column
of the Income Statement and are transferred from the capital reserve to the revenue reserve in the Statement of
Changes in Equity.
Recognition, derecognition and measurement
The Company recognises unquoted investments measured at fair value through profit or loss on the date it commits
to purchase the instrument. Derecognition of an investment occurs when the rights to receive cash flows from
the investment expires or is transferred and substantially all of the risks and rewards of ownership have been
transferred.
The amount that may be realised from the disposal of an investment in the Master Fund may differ from the values
reflected in the financial statements.
Fair value estimation
The Master Fund is unquoted and accordingly the fair value of the investment is determined based primarily on the
NAV information provided by the administrator of the Master Fund. The NAV of the Master Fund is determined by the
administrator of the Master Fund by deducting the fair value of the liabilities of the Master Fund from the fair value of
the Master Fund’s assets.
All portfolio assets are held at fair value by the Marwyn Funds which hold them in accordance with International
Financial Reporting Standards. Where there is no active market for a listed investment, or where the investment is
unlisted, the valuation methodologies applied are fully compliant with International Private Equity and Venture Capital
valuation guidelines as updated.
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Notes to the Financial Statements
3.5 Financial liabilities
The Company recognises a financial liability on assuming a financial obligation and derecognises financial liabilities
when, and only when, the Company’s obligations are discharged, cancelled or they expire. Borrowings are initially
measured at fair value net of transaction costs and subsequently measured at amortised cost using the effective
interest method, with interest expense recognised on an effective yield basis in the Income Statement. Financial
liabilities include loans payable, accruals and dividends payable.
3.6 Cash and cash equivalents
Cash and cash equivalents comprise bank balances held by the Company including short-term bank deposits with an
original maturity of three months or less.
3.7 Finance income
Interest income on cash deposits is accounted for on an accruals basis.
3.8 Expenditure
Pursuant to the “Amended and restated agreement relating to Class F, Class G and Class R interests in MVI LP”, the
Master Fund is legally obliged to settle all expenses specifically attributable to the Company. The Manager does not
receive a management fee or incentive allocation from the Company in respect of funds invested by the Company
in the Master Fund. A summary of costs ultimately incurred by both the ordinary shareholders and realisation
shareholders is included in the ‘Key Information Documents’, located in the ‘Documents’ section of the Company’s
website, www.marwynvalue.com.
3.9 Costs directly attributable to the issue of equity
Share issue costs are placing expenses directly relating to the issue of the Company’s shares. These expenses include
fees payable under share placement agreements, printing, advertising and distribution costs and legal fees and any
other applicable expenses. All such costs are charged to equity and deducted from the proceeds received.
3.10 Investment in unconsolidated structured entities
IFRS 12 Disclosures of Interest in Other Entities defines a structured entity as an entity that has been designed
so that voting or similar rights are not the dominant factor in deciding who controls the entity, such as when any
voting rights relate to the administrative tasks only and the relevant activities are directed by means of contractual
agreements.
The Company has concluded that the Master Fund, in which it invests, but that it does not consolidate, meets the
definition of a structured entity because:
• the voting rights in the Master Fund are not dominant rights in deciding who controls them as they relate to
administrative tasks only;
• the Master Fund’s activities are restricted by its stated investment policy, as disclosed in the Company’s
prospectus; and
• the Master Fund has a narrow and well-defined objective to provide investment opportunities to investors.
3.11 Segment reporting
The Company is organised and operates as one segment by allocating its assets to its investment in the Master Fund
which is not actively traded.
4. Critical accounting estimates and judgements
The Company makes estimates, judgements and assumptions that affect the reported amounts of assets
and liabilities. Estimates and underlying assumptions are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are believed to be reasonable under the
circumstances.
The fair value of the investment held in Marwyn Value Investors LP is determined by the Directors on the basis of the
NAV of the Master Fund as determined by the Administrator at the year end. In turn, the NAV of the Master Fund is
primarily determined by the fair value of its underlying investments which comprise fair value hierarchy level 1, level 2,
and level 3 investments. Due to their unobservable nature, level 3 investments are inherently subject to a higher degree
of judgement and uncertainty.
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Notes to the Financial Statements
The fair value of the investment held by the Master Fund in Marwyn Value Investors II LP is determined by the
Administrator and is also primarily based on the fair value of its underlying investments, which comprise level 1, level 2,
and level 3 fair value hierarchy equities.
5. Taxation
The Company is exempt from all forms of taxation in the Cayman Islands, including income and capital gains. However,
dividend income and certain other interest from other countries are subject to withholding taxes at various rates.
The Company recognises interest and penalties, if any, related to unrecognised tax benefits as income tax expense in
the Statement of Comprehensive Tax. During the years ended 31 December 2022 and 31 December 2021, the Master
Fund did not incur any interest or penalties. The Company is tax resident in Jersey and subject to the standard rate of
corporate tax of 0%. The Board has considered the Company’s tax positions, and has concluded that no liability for
unrecognised tax liabilities should be recorded relating to uncertain tax positions for open tax years and the positions
for tax year ended 31 December 2022.
The Directors intend to manage the affairs of the Company in such a way that it is tax resident in Jersey only. In these
circumstances, the Company will not be subject to tax on its profits and gains (other than withholding tax on any
interest or certain other income which has a United Kingdom source) in any jurisdiction other than Jersey.
The Company recognises the tax benefits of uncertain tax positions only where the position is ‘more likely than not’
to be sustained assuming examination by tax authorities. As at 31 December 2022, there are no such tax benefits
recognised (31 December 2021: none).
6. Financial assets measured at fair value through profit or loss
As at 31 December 2022, 100% (2021: 100%) of the financial assets at fair value through profit or loss relate to the
Company’s investment in the Master Fund. The fair value of the investment in the Master Fund is based on the latest
available NAV reported by the administrator of the Master Fund. The limited partnership interests in the Master Fund
are not publicly traded.
As a result, the carrying value of the Master Fund may not be indicative of the value ultimately realised on redemption.
In addition, the Company may be materially affected by the actions of other investors who have invested in the Portfolio
Companies in which the Master Fund has directly or indirectly invested.
References to Class F interests, Class R(F)1, Class R(G)1 interests and Class R(F)2 interests correspond to the respective
classes of interests in the Master Fund.
31 December 2022 31 December 2021
£ £
Master Fund
Opening cost 85,190,009 89,036,108
Redemption of Class R(F)1 and Class R(G)1 interests - (3,846,099)
Closing cost 85,190,009 85,190,009
Unrealised gain brought forward 20,078,592 8,561,680
Movement in unrealised (loss)/gain (2,980,912) 11,516,912
Unrealised gain carried forward 17,097,680 20,078,592
At fair value in accordance with IFRS 13 102,287,689 105,268,601
Class F interests 98,111,816 101,937,692
Total attributable to ordinary shareholders 98,111,816 101,937,692
Class R(F)1 interests 2,635,082 2,035,681
Class R(G)1 interests 872,925 632,934
Total attributable to 2016 realisation shareholders 3,508,007 2,668,615
Class R(F)2 interests 667,866 662,294
Total attributable to 2021 realisation shareholders 667,866 662,294
At fair value in accordance with IFRS 13 102,287,689 105,268,601
Realised gain on redemption of Class R(F)1 and Class R(G)1 interests - 2,515,114
Total net realised gain on redemptions - 2,515,114
Unrealised (loss)/gain recognised in the year (2,980,912) 11,516,912
Net (loss)/gain recognised in the Statement of Comprehensive Income (2,980,912) 14,032,026
Net Asset Value – investment movements
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Notes to the Financial Statements
The net gain/(loss) recognised on financial assets measured at fair value through profit or loss reported in the
Statement of Comprehensive Income consists of the movement in the unrealised gain/(loss) and the net realised
gain/(loss) on redemptions. Realised gain/(loss) is subsequently transferred from the capital reserve to the revenue
reserve.
The Company holds 100% of the Class F interests which represents 93.17% (2021: 94.17%) of the NAV of the Master
Fund, 100% (2021: 100%) of the Class R(F)1 interests which represent 2.50% (2021: 1.88%) of the NAV of the Master
Fund, 100% (2021: 100%) of the Class R(G)1 interests which represent 0.83% (2021: 0.58%) of the Master Fund and
100% (2021: 100%) of the Class R(F)2 interests which represent 0.63% (2021: 0.61%) of the Master Fund.
As the Company has no legal, operating or management control over the activities of the Master Fund or MVI II
LP and has no voting power in either of their affairs, neither the Master Fund nor MVI II LP are considered to be
subsidiaries.
Fair value hierarchy
The Company classifies fair value measurements using a fair value hierarchy that reflects the significance of the
inputs used in making the measurements. The fair value hierarchy has the following levels:
- quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1)
- inputs other than quoted prices included within level 1 that are observable for the asset or liability,
either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2)
- inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs)
(level 3)
The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety is
determined by the lowest level input that is significant to the fair value instrument. For this purpose, the significance
of an input is assessed against the fair value measurement in its entirety. Assessing the significance of a particular
input to the fair value measurement requires judgement, considering factors specific to the asset or liability.
The determination of what constitutes ‘observable’ requires significant judgement. Observable data is considered
to be market data that is readily available, regularly distributed or updated, reliable, not proprietary and provided by
independent sources that are actively involved in the market.
Taking into account the valuation methodology applied to the investments in the Master Fund and in MVI II LP (which
is held by the Master Fund at NAV), the Company’s valuation of investments is classified as level 3 (2021: level 3). The
Portfolio Company investments are categorised as level 1 fair value measurement if they are quoted in active markets
(Zegona, AdvancedAdvT) or as level 3 if they are unquoted investments (Silvercloud).
For Portfolio Company investments which are quoted, but where trading in the stock does not constitute an ‘active
market,’ under IFRS alternative valuation techniques are applied. 450 plc, MAC Alpha, MAC II and MAC III are all valued
by reference to unobservable inputs and are therefore classified as level 3. These level 3 categorised investments are
valued in accordance with IPEV Guidelines.
The following table presents the movement in the Company’s investments classified as Level 3 instruments:
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Opening balance 105,268,601 97,597,788
(Loss)/profitincludedinStatementofComprehensiveIncome (2,980,912) 14,032,026
Disposal of Class R(F) and Class R(G) interests - (6,361,213)
Closing balance 102,287,689 105,268,601
31 December 31 December
2022 2021
£ £
Notes to the Financial Statements
7. Loan payable
The Master Fund has made a loan to the Company of £125,000 (2021: £125,000) for which the Company pays interest
received on the corresponding cash amount held. The loan will be repaid by set-off on the date that the Company’s
interests in the Master Fund are redeemed. As a cash balance is held to the value of the loan payable and all interest
earned on the cash balance is added to accruals, the effect of discounting is not material to the cash flows or balance
sheet position.
8. Cash and cash equivalents
For the purposes of the Statement of Cash Flows, cash and cash equivalents comprise balances with original maturity
of less than 3 months, which total £129,145 as at 31 December 2022 (2021: £128,554).
9. Distributions
Distributions in 2022:
Ordinary shares
Quarterly interim dividends of 2.265p per ordinary share were paid in February, May, August and November 2022.
The quarterly dividends have continued in 2023, with a further payment of 2.265p per ordinary share paid in
February 2023.
Distributions in 2021:
Ordinary shares
Following discussions with the Company’s shareholders relating to the Company’s implementation of the Ordinary
Share Distribution Policy, the share buy-back programme that had been in place since 2018 was suspended and
effective from the start of 2021, the Company reverted to the payment of dividends. Pursuant to this, quarterly
interim dividends of 2.265p per ordinary share were paid in February, May, August and November 2021.
Realisation shares
In October 2021, the Company announced that funds attributable to realisation shareholders received from the
completion of Zegona’s tender offer, along with cash held by the Master Fund attributable to realisation shareholders
not required to be held for reasonable working capital purposes would be returned to realisation shareholders by
way of a redemption of realisation shares.
Following a redemption of the Company’s interests in Class R(F) and Class R(G) of the Master Fund to the value of
£6.4 million, the distribution to realisation shareholders was effected by way of a redemption of 2,750,985 realisation
shares which were subsequently cancelled.
As the Class R(F) reference amount, preferred return and preferred return catch-up (as described in Note 14(a) have
been fully returned, an incentive allocation payment in respect of Class R(F) of £1,225,609 was paid alongside the
redemption of the realisation shares.
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The following table summarises the valuation methodology used for the Company’s investments characterised as
Level 3:
Year end Security Fair Value £ Valuation methodology Unobservable inputs Ranges
At 31 Dec 2022 Master Fund 102,287,689 NAV Zero % discount N/A
At 31 Dec 2021 Master Fund 105,268,601 NAV Zero % discount N/A
Notes to the Financial Statements
10. Share capital and distributions
Share capital
As at 31 December 2022 and 31 December 2021 the authorised share capital was as follows:
The ordinary share capital of the Company with a par value of 0.0001p may be issued or redesignated in classes and
includes realisation shares.
Ordinary shares of 0.0001p each 10,893,258,506,473
Exchange shares of 0.0001p each 10,892,176,350,000
Deferred shares of 9.9999p each 82,156,473
Ordinary* Exchange Total Ordinary* Exchange Total
As at 1 January 56,783,912 30,970,984 87,751,896 59,534,897 30,970,984 90,505,881
Redemption - - - (2,750,985) - (2,750,985)
Exchange - - - - - -
As at 31 December 56,783,912 30,970,984 87,751,896 56,783,912 30,970,984 87,751,896
Share capital (£) 57 31 88 57 31 88
Shares in issue
2022 2021
The weighted average number of shares in issue for the year ended 31 December:
2022 2021
Ordinary 55,490,360 55,819,238
2016 Realisation 933,070 3,254,449
2021 Realisation 360,482 31,604
Ordinary shares* 2022 2021
As at 1 January 61,455,770 64,436,254
Redemption and exchange - (2,980,484)
As at 31 December 61,455,770 61,455,770
Share premium
*Includes ordinary, 2016 realisation and 2021 realisation shares, which constitute a single class of
share for the purpose of the Company’s Articles and Cayman law.
(a) Voting rights
(i) Ordinary shares (including 2016 realisation shares and 2021 realisation shares) carry the right to
receive notice of and attend and vote at any general meeting of the Company in accordance
with the Articles.
(ii) Exchange shares carry the rights to receive notice of and to attend any general meeting of the
Company but not vote unless there are no ordinary shares in issue in which case Exchange shares will have
the voting rights set out in (i) above as if exchange shares were ordinary shares.
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Notes to the Financial Statements
(b) Dividends and distributions
(i) Subject to the Companies Law, the Directors may declare dividends (including interim distributions) and
distributions on shares in issue and authorise payment of the dividends or distributions out of the funds of
the Company lawfully available. No dividend or distribution will be paid except out of the realised or
unrealised profits of the Company, or as otherwise permitted by the Companies Law. There are no fixed
dates on which the entitlement to dividends arises. All dividend payments will be non-cumulative.
(ii) Distributions on each class of ordinary shares may only be paid from proceeds received from the
corresponding class of interests in the Master Fund.
(iii) Exchange shares will not confer any rights to dividends or other distributions.
(iv) At the 2015 EGM a new Ordinary Share Distribution Policy was adopted which resulted in:
• a progressive return, payable quarterly in the form of a dividend that will be maintained or grown on a pence
per ordinary share basis.
• in addition to the return detailed above, where the Master Fund or MVI II LP disposes of an asset for a
Net Capital Gain and has not already returned an aggregate amount in excess of 50% of that gain and
any previous such gains pursuant to the distribution policy, the Company will make an additional capital
return of the difference to ordinary shareholders by way of tender offers, share repurchases or other
returns of capital and distributions; and
• the opportunity to augment the distribution policy by returning cash in excess of the amounts referred to in
(i) and (ii) above being kept under review and to be undertaken through periodic tender offers,
share repurchases or other returns of capital and distributions.
(v) At an ordinary class meeting held on 5 September 2018, the Ordinary Share Distribution Policy was further
amended, permitting the ‘Minimum Annual Distribution’ to be made by the repurchase of ordinary shares.
Under the amended policy, returns to ordinary shareholders may be made by repurchase of shares, dividend
payments, or a combination of both.
In January 2021, the Company announced that following feedback from the Company’s significant shareholders on
the implementation of this policy, the Board has determined that from the start of 2021, the most suitable method to
satisfy the minimum distribution is through the payment of dividends. Interim dividends of 2.265p per ordinary share
were paid in February, May, August and November 2022, with further quarterly interim dividends of the same amount
continuing in February 2023.
The Ordinary Share Distribution Policy (described in sections (iv) and (v) above) does not apply to the 2016 realisation
shares or the 2021 realisation shares.
(c) Realisation opportunities
In October 2016 and October 2021, the Company offered its shareholders the opportunity to redesignate some or all
of their ordinary shares of 0.0001p each in the capital of the Company as 2016 realisation shares and 2021 realisation
shares respectively of the same par value. The realisation shares rank equally and otherwise carry the same rights
as the ordinary shares, save that (i) the investment policy differs to that of the ordinary shares, the realisation pool is
only permitted to invest cash in follow-on investments in the Portfolio Companies within three years of creation of the
realisation pool and cash generated on the sale of an investment in the realisation pool may not be re-invested, (ii) the
distribution policy for the ordinary shares will not apply and (iii) the realisation shares entitle their holders to returns
only in respect of realisations made on investments attributable to the realisation pool.
Realisation opportunities will be offered every five years, with the next scheduled for November 2026.
(d) Rights as to capital
There are no exit penalties for those ordinary shareholders electing to re-designate all or some of their investment
into realisation shares or on a return of capital attributable to the realisation shares. Whilst the 2016 realisation shares
and 2021 realisation shares currently in issue are listed on the Specialist Fund Segment, listing of any future series of
realisation shares from future offers will be subject to the receipt of all required consents and approvals, including the
approval of the FCA of a prospectus in relation to their admission to trading.
The surplus capital and assets of the Company will, on a winding-up or on a return of capital (otherwise than on a
purchase by the Company of any of its shares) be paid to the holders of ordinary shares, 2016 realisation shares and
2021 realisation shares pro rata to their holding of such shares out of the proceeds of the corresponding class of
interests in the Master Fund.
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Notes to the Financial Statements
11. Reserves
Special distributable reserve
A special distributable reserve was created when the Company cancelled all of its share premium account in existence
as at 26 January 2007, transferring it to a distributable reserve to allow, among other things, the buy-back and
cancellation of the ordinary shares subject to shareholder approval at a subsequent AGM.
Exchange reserve
Movements in capital in respect of the Exchange Procedure are recognised in the exchange reserve. In 2022, £nil
(2021: £nil) was recognised in the exchange reserve following the exchange of the Company’s ordinary shares held by
the Master Fund as explained above.
Where the Company’s partnership interests in the Master Fund are cancelled following exchanges by the Master
Fund out of ordinary shares, the capital amount previously transferred to the exchange reserve is transferred to the
revenue reserve. There was no such movement in 2022 (2021:£nil), as the Exchange Procedure was not utilized
during the year.
Revenue reserve
Realised gains and losses on redemptions of interests in the Master Fund made during the year are transferred
from the capital reserve to the revenue reserve. In the current year, £nil has been recognised as a realised gains on
redemption of interests in the Master Fund (2021: £2,515,114 realised gain).
Capital reserve
Unrealised gains and losses on interests in the Master Fund are recognised in the capital reserve.
12. Instruments and associated risks
The Company invests substantially all of its assets in the Master Fund, which is exposed to market risk (including
currency risk, interest risk and price risk), credit risk and liquidity risk arising from financial instruments it holds.
As at 31 December 2022, the Company owned 97.14% (31 December 2021: 97.25%) of the net assets of the Master
Fund.
Market price risk
The Company is exposed to the same market price risk arising from uncertainties about future changes in the
values of the underlying Portfolio Companies. The Board monitors the market price risks inherent in the investment
portfolio by ensuring full and timely access to relevant information from the Manager. The Board receives quarterly
reports from the Manager, meets regularly with the Manager both formally and informally, and at each quarterly
board meeting reviews and challenges the Manager on investment performance, providing input and advice on the
investment activity of the Manager.
Any movement in the value of the ordinary interests or the realisation interests of the Master Fund would result in an
equivalent movement in the reported NAV per ordinary share and realisation share respectively.
The Company’s exposure to changes in market prices at 31 December 2022 and 31 December 2021 on its unquoted
investments was as follows (as at both dates, changes arise exclusively from the Company’s investment in the Master
Fund):
2022 2021
£ £
Financialassetsmeasuredatfairvaluethroughprofitorloss–ordinaryshares 98,111,816 101,937,692
Financialassetsmeasuredatfairvaluethroughprofitorloss–2016realisationshares 3,508,007 2,668,615
Financialassetsmeasuredatfairvaluethroughprofitorloss–2021realisationshares 667,866 662,294
102,287,689 105,268,601
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Notes to the Financial Statements
2022 2021
Analysis of Analysis of
monthly returns monthly returns
Number of periods 12 12
Percentprofitable 33% 67%
Average period return 0.19% 1.56%
Averagereturninprofitablemonths 2.13% 2.99%
Average return in loss making months (0.78)% (1.04)%
The following table shows the average monthly performance of the reported NAV of the Company:
The impact on net income and equity of the average monthly period returns set out in the above table as at 31
December 2022 and 2021 is as follows:
The Company invests directly in the Master Fund and indirectly in MVI II LP. The Company is therefore exposed to
price risks derived from the investment portfolios of the Master Fund and MVI II LP.
The Company is exposed to a loss limited to the value of its investment in the Master Fund if the market value of
the Master Fund’s investment holdings decreases. The Master Fund’s direct and indirect investments in underlying
Portfolio Companies are subject to normal market fluctuations and the risks inherent in investment in international
securities markets. There is no assurance that the Master Fund’s objective of capital appreciation will be achieved.
Currency risk
The Company is not directly exposed to any material currency risk, although this may be a factor in price risk as a
result of the investments made by the Master Fund or by MVI II LP as certain Portfolio Company investments may
invest in underlying assets denominated in other currencies. It is therefore considered that the Company is not
materially exposed to significant direct currency risk.
Increase (%) Decrease (%) Net income (£) Equity (£) Net income (£) Equity (£)
2022 2.13 (0.78) 2,176,288 2,176,288 (799,952) (799,952)
2021 2.99 (1.04) 3,150,466 3,150,466 (1,096,014) (1,096,014)
Monthly returns Impact of Increase Impact of Decrease
Monetary assets in Sterling 112,786,759 115,361,245
Non-monetary assets in Sterling - -
Monetary liabilities in Sterling (385,128) (478,191)
Non-monetary liabilities in Sterling - -
31 December 31 December
2022 2021
£ £
Summary of currency exposure of the Master Fund
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Notes to the Financial Statements
Liquidity risk
The Company may not sell its investment in the Master Fund without the approval of the Master Fund’s General
Partner. Redemption opportunities are available in relation to ordinary shares in line with the policy adopted at the
2013 extraordinary general meeting and as disclosed in note 10(c). Further, the Master Fund has no control over the
timing of the redemption of its investment in MVI II LP and a significant proportion of the investments in the Portfolio
Companies are in publicly traded equities, the holdings of which may not be readily realisable due to their size or in
private companies which may also not be readily realisable. As such the Master Fund and/or Company may not be
able to readily dispose of such illiquid investments and, in some cases, may be contractually prohibited from doing so.
However, the Company’s liquidity profile of its assets is matched with the liquidity profile of its liabilities, as described
below.
The Company holds Class F, Class R(F)1, Class R(G)1 and Class R(F)2 interests in the Master Fund. The policy is that
the Company should remain fully invested in normal market conditions. The Company is only required to settle its
liabilities when its investment is fully redeemed. The following table shows the contractual, undiscounted cash flows
of the Company’s financial liabilities:
The Company holds, and will continue to hold, a minimum cash balance of £125,000 (2021: £125,000) in respect of the
£125,000 loan payable to the Master Fund (2021: £125,000) (see Note 7). The remainder of the loan will be repaid by
set-off on the date that Master Fund interests are fully redeemed.
As all Company specific operating expenses, other than share issue costs paid directly by the Company from the
proceeds of shares issued, are paid by the Master Fund as disclosed in Note 3.8 and as the loan is repayable by set-
off, the Directors do not consider the Company has any net liquidity risk.
Interest rate risk
The Company itself is not exposed to significant interest rate risk, however it is indirectly exposed to such risk through
its direct investment in the Master Fund and indirect investment in MVI II LP. Details of this exposure to interest rate
risk are set out below:
The Master Fund and to a lesser extent MVI II LP hold cash and cash equivalents at short-term market interest rates,
resulting in exposure to risks associated with the effects of fluctuations in the prevailing levels of the market interest
rates on its cash flows. The impact of any movement in interest rates is not considered to have a material effect on the
Master Fund or MVI II LP.
The remainder of the Master Fund’s assets and liabilities are non-interest bearing.
Credit risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to
discharge an obligation. The main credit risks for the Company relate to the cash held with financial institutions. The
credit risk relating to the direct investment into the Master Fund and indirect investment into MVII LP relates to both
cash held with financial institutions and equities held by the custodian.
The Company, the Master Fund and MVI II LP manage their exposure to credit risk associated with their cash deposits
by selecting counterparties with a high credit rating with which to carry out these transactions. The Company’s
maximum exposure to credit risk is the carrying value of the cash on the balance sheet.
Less than 1 month 1-3 months Less than 1 month 1-3 months
2022 2022 2021 2021
£ £ £ £
Loan from Master Fund 125,000 - 125,000 -
Payables and accruals 4,146 - 3,554 -
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Notes to the Financial Statements
The Master Fund and MVI II LP manage their exposure to credit risk associated with the custody of their equities by
selecting counterparties with a strong credit rating.
The Master Fund does not expect to incur material credit losses on its financial instruments. At 31 December 2022,
having considered the Portfolio Companies directly and indirectly held by the Master Fund, the Board considers
that credit risk is limited to the extent of the equity investments in the underlying Portfolio Companies (the risks
associated with such investments have been considered under Market Price Risk) and the drawn down facility
extended to Silvercloud Holdings. The carrying value of the debt investment is periodically assessed in accordance
with IPEV Guidelines and as 31 December 2022, the Silvercloud Holdings facility is considered to be fully recoverable.
13. Material contracts and related-party transactions
In the opinion of the Directors on the basis of shareholdings advised to them, the Company has no ultimate
controlling party.
The Company, the Master Fund and MVI II LP are each managed by the Manager.
Parties are considered to be related if one party has the ability to control the other party or exercise significant
influence over the other party, or the parties are under common control or influence, in making financial or
operational decisions.
a) Management fee, investment advisory fee and incentive allocation
Management fee
Under a management agreement dated 1 April 2021, Marwyn Investment Management LLP was appointed Manager
to the Company. Under this management agreement, the Company does not pay any fees to the extent that it invests
its assets solely in the Master Fund. In respect of any assets of the Company not invested in the Master Fund, the
Manager is entitled to receive aggregate performance and management fees on the same basis as those to which it
would have been entitled if such assets had been those of the Master Fund.
The Company has not made any such investments during the year and, as such, no fees were paid by the Company or
payable at the year end (2021: £ Nil).
Under the Master Fund management agreement, the Manager receives monthly management fees from the
Master Fund not exceeding 2% of the NAV before incentive allocations of each class of interests in the Master Fund,
payable monthly in arrears. From 30 November 2018, being 2 years after the creation of the 2016 realisation pool,
the management fee on the 2016 realisation share interests is calculated by reference to NAV before management
fees and incentive allocation less the aggregate value of cash and near cash investments attributable to the 2016
realisation share interests. From 30 November 2023, being 2 years after the creation of the 2021 realisation pool, the
same calculation will be applied to the management fee on the 2021 realisation share interests.
The total management fee expense, borne by the Master Fund in respect of the interests invested in by the Company
for the year ended 31 December 2022 was £2,086,594 (31 December 2021: £2,197,437).
Incentive allocation
Incentive allocations borne by the Class F, Class R(F)1, Class R(G)1 and Class R(F)2 interests in the Master Fund are
only payable on returns being made to shareholders as disclosed in Part II, section 6 of the Company’s most recent
prospectus published on 19 October 2021. This prospectus is available on the Company’s website.
Returns from each of these classes in the Master Fund are allocated:
1) to investors up to the value of the ‘reference amount’;
2) to investors to satisfy a preferred return of 7.5% accrued on the outstanding reference on a daily basis;
3) paid as a ‘catch-up’ incentive allocation of 25% of the preferred return until returns in excess of the
reference amount are split 80:20 between investors and incentive allocations; and
4) all remaining returns are split 80:20 between investors and incentive allocation payments.
In the case of Class R(F)1, an ‘initial incentive allocation’, equal to 5% of the reference amount, was payable once the
full reference amount had been returned to investors.
The incentive allocation accrued by the Master Fund at each valuation date is calculated by allocating the gross asset
value for each class in the manner described above.
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Notes to the Financial Statements
Incentive allocation attributable to ordinary shareholders
As at 31 December 2022, the outstanding Class F reference amount was £74,155,708 and the preferred return due
to investors was £15,897,320. The Class F gross asset value of £104,100,844, being in excess of the sum of these,
resulted in an incentive allocation accrual at the balance sheet date of £5,989,027 (31 December 2021: £5,688,639).
The expense relating to the increase in total incentive allocation for Class F for the year was £300,388 (31 December
2021: £4,137,197).
Incentive allocation attributable to realisation shareholders
As at 31 December 2022, the Class R(F)1 reference amount, initial incentive amount, preferred return and preferred
return catch-up had all been paid in full. The Class R(F)1 gross asset value of £3,293,852 resulted in an incentive
allocation accrual at the balance sheet date is £658,770 (31 December 2021: £508,920). The outstanding Class R(G)1
reference amount was £1,370,875 and the preferred return due was £1,820,113. The Class R(G)1 gross asset value of
£872,988 is all allocated against the outstanding reference amount and accordingly there is no incentive allocation
accrual at the balance sheet date (31 December 2021: Nil). The expense relating to the increase in total incentive
allocation for Classes R(F)1 and R(G)1 was £149,850 (31 December 2021: £463,722).
As at 31 December 2022, the outstanding Class R(F)2 reference amount was £514,397 and the preferred return due
to investors was £104,431. The Class R(F)2 gross asset value of £706,233, being in excess of the sum of these, resulted
in an incentive allocation accrual at the balance sheet date of £38,367 (31 December 2021: £36,974). The expense
relating to the increase in total incentive allocation for Class R(G)2 was £1,393 (31 December 2021: £5,355).
The Company does not bear any management fee or incentive allocation in relation to the Master Fund’s investment
into MVI II LP.
(b) Administration fee
On 22 January 2021, Aztec Financial Services (Jersey) Limited was appointed as the administrator of the Company.
Aztec’s fees for administration of the Company were £149,500 per annum up to 31 March 2022, adjusted to £162,955
per annum from 1 April 2022. These are paid by the Master Fund. Aztec is not considered to be a related party.
(c) Board of Directors’ remuneration
Directors’ fees are paid by the Master Fund. The Directors of the Company received the following annual fees:
(d) Secondment services
Effective from 1 December 2020, Marwyn Jersey Limited, an entity forming part of the Marwyn group, has seconded
certain individuals to the Company. Marwyn Jersey Limited charged £90,563 for these services for the year to 31
December 2022 (31 December 2021: £108,333).
14. Capital management policies and procedures
The Company’s capital management objectives are to ensure that it will be able to continue as a going concern and to
maximise capital return to its equity shareholders.
Annual fee Payable from 1 January 2022 to 31 December 2022
Robert Ware £50,000 £50,000
Martin Adams £45,000 £45,000
Peter Rioda £35,000 £35,000
Victoria Webster £35,000 £35,000
All Directors are entitled to receive reimbursement for all travel and other costs incurred as a direct result of carrying
out their duties as Directors.
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Notes to the Financial Statements
2022 2021
£ £
Share capital 88 88
Share premium 61,455,770 61,455,770
Special distributable reserve 26,346,979 26,346,979
Exchange reserve 54,386 54,386
Capital reserve 3,159,948 3,159,948
Revenue reserve 11,270,518 14,251,430
Totalcapital 102,287,689 105,268,601
The Board, with the assistance of the Manager, monitors and reviews the structure of the Company’s capital on an
ongoing basis.
15. Ordinary shares - by series
The Company has the ability to issue different series of ordinary shares (including realisation shares), the proceeds
of which can be invested in separate classes of the Master Fund. Distributions on each series of ordinary shares
may only be paid from proceeds received from the corresponding class of interests in the Master Fund. The surplus
capital and assets of the Company will on a winding-up or on a return of capital (otherwise than on a purchase by
the Company of any of its shares) be paid to the holders of each series of the ordinary share pro rata to their holding
of such ordinary shares out of the proceeds of the corresponding class of interests in the Master Fund. As at 31
December 2022, ordinary shares, 2016 realisation shares and 2021 realisation shares remained outstanding as per
Note 10. The information in the Risk section starting on page 74 sets out the risks applicable to these shares in issue.
16. Commitments and contingent liabilities
There were no commitments or contingent liabilities of the Company outstanding at 31 December 2022 or 31
December 2021 that require disclosure or adjustment in these financial statements.
17. VAT Reclaim
In November 2012, an underlying investment of the Master Fund, Le Chameau Group plc (“LCG”) (formerly Marwyn
Management Partners Plc) sold its holding in Praesepe plc, a company operating in the gaming industry.
At the time of the sale there was an ongoing dispute between the gaming industry and HMRC on the principle of fiscal
neutrality. The basis of the dispute was that some similar forms of gambling were treated differently for VAT purposes
and test cases were pursued by The Rank Group Plc and Done Brothers (Cash Betting) Ltd.
Based on these test cases, Deloitte LLP and PricewaterhouseCoopers LLP were engaged by Praesepe plc to submit
VAT reclaims to HMRC on a contingent fee basis. Certain of these VAT reclaims relate to the period of LCG’s ownership
and as such, under the terms of the sale agreement, a subsidiary of LCG retained a beneficial interest in the VAT
reclaims that related to the period of LCG’s ownership. The existence of these contingent VAT reclaims was disclosed
in the historic financial statements of LCG and the contingent asset was transferred in 2020 to the Master Fund as
part settlement of the outstanding loan between the LCG group and the Master Fund.
Following the First-tier Tribunal ruling in favour of The Rank Group Plc, HMRC publicly confirmed that it would not
appeal the decision made by the First-tier Tribunal.
Over the course of 2022, £4.98 million was agreed and received by the Master Fund and there is sufficient over the
recoverability of the remaining amounts to recognise a receivable of £5.02 million as at 31 December 2022. These
remain dependent on final settlement with HMRC and whilst the actual amount received may be different, any
difference is not expected to be material. The timing of receipt of cash into the Master Fund also remains uncertain;
based on the timeline for the settlement of previous claims, it is currently estimated that these amounts will be
received in 2023.
18. Subsequent events
Under the Company’s Ordinary Share Distribution Policy, an interim dividend was paid to ordinary shareholders on
24 February 2023 of 2.265p per ordinary share.
The Company’s capital at 31 December comprises:
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The Audit Committee performs a detailed review of the
risks applicable to the Company at least annually and
reports its findings for the consideration of the Board.
The Board have a range of knowledge and contacts
across the investment industry and are provided regular
updates from the Manager, broker, legal counsel and
Administrator to help identify any new risks applicable
to the Company. Those risks that are considered most
significant are included below.
Risks applicable to investing in the Company
Past performance
The past performance of the Company, the Master Fund,
MVI II LP, the Manager and the principals of the Manager
may not be indicative of future performance.
Dependence on key individuals
The success of the Company, the Master Fund and MVI II
LP depends upon the ability of the Manager to develop
and implement investment strategies that achieve the
Marwyn Fund’s investment objectives. If the Manager
were to become unable to participate in the investment
management of the Funds, the consequence for the
Company and the Marwyn Funds would be material and
adverse and could lead to the premature winding-up of
the Company and/or Marwyn Funds.
Net asset value considerations
The NAV per ordinary share, 2016 realisation share and
2021 realisation share, the NAV of the Master Fund and
the NAV of MVI II LP is expected to fluctuate over time with
the performance of the Company’s, the Master Fund’s
and/or MVI II LP’s investments.
Where, in relation to the calculation of the NAV, there is
any conflict between IFRS and the valuation principles
set out in the prospectus in relation to the Company, the
latter principles shall take precedence.
Where in relation to the calculation of the NAV of the
Master Fund there is any conflict between US GAAP
and the valuation principles set out in the limited
partnership agreement of the Master Fund or its offering
memorandum, the latter principles shall take precedence.
Where in relation to the calculation of the NAV of MVI II
LP there is any conflict between IFRS and the valuations
principles set out in the limited partnership agreement of
MVI II LP or its private placement memorandum, the latter
principles shall take precedence.
Liquidity risk
The investment objectives of the Company, the Master
Fund and MVI II LP allow them to invest in instruments
which may be both illiquid and scarce. Market conditions
may increase illiquidity and scarcity and have a generally
negative impact on the Manager’s ability to identify
and execute suitable investments that might generate
acceptable returns. Market conditions may also restrict
the supply of investment assets that may generate
acceptable returns and thereby cause “cash drag”’ on the
Company’s performance. Adverse market conditions and
their consequences may have a material adverse effect
on the Company’s investment portfolio. To the extent that
there is a delay in making investments, the Company’s
returns will be reduced.
Market price
It is very unlikely that the market price of the ordinary
shares, 2016 realisation shares or 2021 realisation shares
will fully reflect the underlying value of the investment
made by the Company and the underlying investments
held by the Master Fund and MVI II LP which are
attributable to any of the share classes. The underlying
investments of the Company may be subject to market
fluctuations and the risks inherent in all investments and
there can be no assurance that an investment will retain
its value or that appreciation will occur.
As well as being affected by the underlying value of
the assets held, the market value of the ordinary,
2016 realisation or 2021 realisation shares will also be
influenced by the supply and demand for each class in the
market. As such, the market value of the class of shares
may vary considerably from the underlying value of the
Company’s assets attributable to that class.
Restriction on auditors’ liability
Cayman Islands law does not restrict the ability of auditors
to limit their liability. Consequently, the engagement letters
in relation to the Company, the Master Fund and MVI II LP
contain such a provision as well as containing provisions
indemnifying the auditor in certain circumstances.
Handling of mail
Mail addressed to the Company and/or the Master Fund
and received at their respective registered offices is
scanned and emailed to the Administrator to be dealt
with. None of the Company, the Master Fund, the General
Partner or any of its or their directors, officers or providers
bear any responsibility for any delay howsoever caused in
mail reaching the Administrator as the case may be.
Risk (unaudited)
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Risks Applicable to Investments in the Company
Each series of ordinary shares is not a separate
legal entity
The Company may raise additional finance to invest in the
Master Fund by selling further series of ordinary shares
to investors. The net proceeds of issue of each series
of ordinary shares will be invested by the Company in a
corresponding class of interests in the Master Fund. In
certain circumstances, if the Company incurs a liability
in respect of assets attributable to another series of
ordinary shares, the ability of the Company to distribute
profits or repurchase ordinary shares, not only in relation
to that series, but also in relation to any other series
may be affected because under the Companies Law, the
ability to distribute profits or repurchase ordinary shares
has to be determined by reference to the solvency of the
Company as a whole, rather than on a series by series
basis. Liabilities relating to one ordinary share series
cannot be ring-fenced.
Additionally, the investment assets of the Company
(i.e. namely, its interests in the ordinary interests and
realisation share interests of the Master Fund), are not
legally segregated and so assets held by the Company and
attributed to any class of realisation shareholders may be
required to be liquidated to meet liabilities attributable to
ordinary shareholders (or vice versa).
Risk of not obtaining distributing or reporting status
There is no guarantee that the Company will continue to
obtain distributing or reporting status for UK taxation
purposes in relation to the ordinary shares. There is
therefore a risk that any gain realised on any disposal of
ordinary shares will be taxed as income in the UK, rather
than capital gain.
Sole purpose
The Company has been established with the sole
purpose of investing in the Master Fund. The success of
the Company therefore depends on the success of the
Master Fund and its ability to successfully implement its
investment strategy. Identification and exploitation of the
investment strategies to be pursued by the Master Fund
involve a high degree of uncertainty.
Limited redemption rights
The Company has no right of redemption in relation to
the Class F interests, Class R(F)1 interests, Class R(G)1
interests or Class R(F)2 interests in the Master Fund. The
right of shareholders to elect to move into realisation
shares does not result in the resulting realisation share
interests in the Master Fund (which will be held on behalf
of realisation shareholders) being redeemable. They will
only be redeemed when the underlying investments are
sold.
Cayman Islands registration
The Company is registered in the Cayman Islands. As a
result, the rights of the shareholders are governed by the
laws of the Cayman Islands and the Articles. The rights of
shareholders under Cayman Islands law may differ from
the rights of shareholders of companies incorporated in
other jurisdictions and the enforcement of such rights
may involve different considerations and may be more
difficult than would be the case if the Company had been
incorporated in England and Wales or the jurisdiction of
a shareholder’s residence. The following are examples: (i)
subject only to the Company’s articles of association, the
allotment and issue of securities is under the exclusive
control of the Directors and there are no pre-emption
rights under the Companies Law; (ii) there is no express
restriction on the Company making loans to Directors
nor the equivalent of substantial property rules for
transactions involving Directors under the Companies
Law; and (iii) assets of the Company are under the exclusive
control of the Directors and the Companies Law does not
expressly restrict the powers of the Directors to dispose
of assets. Examples (i) to (iii) above are intended for the
purposes of illustration only and are not an exhaustive
list. Investors should take appropriate independent legal
advice to determine if they are afforded protections they
consider are necessary for their specific circumstances.
The Cayman Islands courts ordinarily would be expected
to follow English case law precedents which permit a
minority shareholder to commence a representative
action against or derivative actions in the name of the
company to challenge (i) an act which is ultra vires the
company or illegal, (ii) an act which constitutes a fraud
against the minority and the wrongdoers are themselves
in control of the company, and (iii) an irregularity in the
passing of a resolution which requires a qualified (or
special) majority. In the case of a company (not being a
bank) having a share capital divided into shares, the courts
may, on the application of members holding not less than
one fifth of the shares of the company in issue, appoint
an inspector to examine the affairs of the company and
to report thereon in such manner as the courts will direct.
Any shareholder of a company may petition the courts
which may make a winding-up order if the courts are of
the opinion that it is just and equitable that the company
should be wound up. Generally, claims against a company
by its shareholders must be based on the general laws of
contract or tort applicable in the Cayman Islands or their
individual rights as shareholders as established by the
company’s memorandum and articles of association.
Risk (unaudited)
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The Company does not exercise control over the
Master Fund or MVI II LP
The Company, in its capacity as an investor, has no
opportunity to control the day-to-day operation, including
investment and disposition decisions made by the
Manager on behalf of the Master Fund or MVI II LP, the
resolution of potential or actual conflicts of interest that
may arise, distributions by the Master Fund or MVI II LP
or the appointment or removal of service providers to the
Master Fund or MVI II LP. The Company does not have the
opportunity to evaluate the relevant economic, financial
and other information that is utilised by the Manager in its
evaluation and selection of investments, does not receive
the detailed financial information regarding investments
that is available to the Manager and has no right to be
informed about actual or potential conflicts of interest.
The Master Fund has adopted the amended distribution
policy in relation to Class F, Class R(F)1, Class R(G)1 and
Class R(F)2 interests in the Master Fund. However, the
Company has no control over the amount or timing of
any redemptions by the Master Fund or MVI II LP or other
distributions which may be used to fund extraordinary
distributions.
The Master Fund, as a limited partner in MVI II LP, has no
control over the investment or disposal decisions of MVI
II LP or timing of any redemptions or other distributions
by MVI II LP.
Conflictsofinterest
The Master Fund and MVI II LP (together the “Master
Funds”) are subject to a number of actual and potential
conflicts of interest with the Company and with each other.
The Company (or, as appropriate, other relevant parties)
aims to manage such conflicts to prevent a material risk
of damaging any investor’s interest. Where this is not
possible the conflicts are disclosed.
Certain inherent conflicts arise from the fact that the
Manager and its affiliates provide investment management
services to both Master Funds and the Company.
In order to ensure an equitable management of the
potential conflicts of interest that could arise in managing
the interests of ordinary shareholders and each class of
realisation shareholders, the Master Funds have agreed
the following policies:
• interests in Portfolio Companies held by the
Master Fund (with the exception of interests in Le
Chameau) attributable to realisation share interests
will only be sold when MVI II LP’s interests in the
same Portfolio Companies are disposed of on a
simultaneous basis. All disposals will be pro rata
between MVI II LP and the Master Fund;
• interests in Le Chameau held by the Master Fund
attributable to realisation share interests will only
be sold when the Master Fund disposes of interests
in Le Chameau attributable to ordinary share
interests on a simultaneous basis. All disposals
will be pro rata between the holdings attributable
to the realisation share interests and the ordinary
share interests; and
• to the extent that the Master Fund and MVI II
LP make follow-on investments in any Portfolio
Companies held by both, this will be pro rata to the
holdings of the Master Fund and MVI II LP in such
shares on the date of such follow-on investment,
provided that the Master Fund shall not be
required to make a follow-on investment to the
extent it does not have cash available to fund such
investment having regard to its working capital
requirements as agreed with the general partner of
the Master Fund (with the prior written agreement
of the Board).
The use of a structure which includes the Master Funds
may also create a conflict of interest in that different tax
considerations for investors in the Company, the Master
Fund and/or MVI II LP may cause the Master Fund and/
or MVI II LP to structure or dispose of an investment in
a manner that is more advantageous to one group than
the other.
In any case where a Director is actually or potentially
conflicted, this conflict is disclosed to the Board and that
Director will not be considered in the quorum for any
resolutions relating to the matter.
Class consents
Certain actions by the General Partner in respect of the
Master Fund require the written consent of investors in
that Class. Where the Directors allow holders of ordinary
shares or realisation shares to vote on a matter for which
the General Partner is seeking investor consent and, if
the resolution is passed by a simple majority of those
voting in person or by proxy at a meeting of the holders
of the relevant shares, the Directors will give consent to
the General Partner in respect of all of the Company’s
interests in the relevant Class. The Company will not split
its consent in accordance with the votes of the holders of
the relevant series of shares.
Risk (unaudited)
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Value and liquidity of the shares
The shares of publicly traded companies can have limited
liquidity and their share prices can be highly volatile. The
price at which the shares will be traded and the price
at which investors may realise their investment will be
influenced by a large number of factors, some specific to
the Company and its operations, and others which may
affect companies operating within a particular sector or
quoted companies generally. Prospective investors should
be aware that the value of the shares could go down as
well as up, and investors may therefore not recover their
original investment. Furthermore, the market price of
the shares may not reflect the underlying value of the
Company’s net assets. There is also no guarantee that any
discount control mechanisms employed by the Board and
the Manager will be effective at managing the level of any
discount.
There is no reliable liquid market for the Company’s
interest in the Master Fund and the valuation of Portfolio
Companies may involve the general partners of the
Master Fund and MVI II LP exercising judgement. This is
particularly the case in the context of the Master Fund’s
investment in Le Chameau which is comprised of unlisted
securities and debt investment for which there is no
liquid market. There can be no guarantee that the basis
of calculation of the value of Portfolio Companies used
in the valuation process will reflect the actual value on
realisation of those investments.
Additionalfinancinganddilution
If the Company issues further series of ordinary shares,
whilst these will not dilute the economic interests of the
existing classes in the Master Fund, the additional ordinary
shares will carry rights to vote at general meetings of the
Company and will therefore dilute shareholders’ voting
rights accordingly. The Directors may seek debt finance
to fund the expansion of the Company. There can be no
assurance that the Company will be able to raise such
debt funds, whether on acceptable terms, or at all. If
debt financing is obtained, the Company’s ability to raise
further finance, and its ability to operate its business, may
be subject to restrictions.
Registration under the US Investment Company Act
and the US Advisers Act
The Company has not been and it is unlikely it will ever
be registered under the US Investment Company Act. In
addition, the Manager has not been and it is unlikely that
it will ever be registered as an “Investment Adviser” under
the US Investment Advisers Act.
Depository Interests
Securities issued by non-UK registered companies, such
as the Company, cannot be held or transferred in the
CREST system. However, to enable shareholders to settle
such securities through the CREST system, a depository
or custodian can hold the relevant securities and issue
dematerialised depository interests representing the
underlying shares which are held on trust for the holders
of these depository interests.
Voting rights
Under the Articles, only those persons who are
shareholders of record are entitled to exercise voting
rights. Persons who hold ordinary shares or realisation
shares in the form of depository interests will not be
considered to be record holders of such shares that are
on deposit with the depository and, accordingly, will not
be able to exercise voting rights. However, the deed poll
which created the depository interests (the “Deed Poll”)
provides that the depository shall pass on, as far as it is
reasonably able, rights and entitlements to vote. In order
to direct the delivery of votes, holders of depository
interests must deliver instructions to the depository by
the specified date.
Neither the Company nor the depository can guarantee
that holders of depository interests will receive the notice
in time to instruct the depository as to the delivery of votes
in respect of shares represented by depository interests
and it is possible that they will not have the opportunity
to direct the delivery of votes in respect of such shares.
In addition, persons who beneficially own shares that are
registered in the name of a nominee must instruct their
nominee to deliver votes on their behalf.
Neither the Company nor any nominee can guarantee
that holders of depository interests will receive any notice
of a solicitation of votes in time to instruct nominees to
deliver votes on behalf of such holders and it is possible
that holders of depository interests and other persons
who hold ordinary shares or realisation shares through
brokers, dealers or other third parties will not have the
opportunity to exercise any voting rights.
Risk (unaudited)
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Limitation of liability
The Deed Poll contains provisions excluding and limiting
the depository’s liability to holders of depository interests.
For example, the depository will not be liable to any holder
of depository Interests or any other person for liabilities
in connection with the performance or non-performance
of obligations under the Deed Poll or otherwise except
as may result from its negligence or willful default or the
fraud of any custodian or agent which is not a member of
its group unless it has failed to exercise reasonable care
in the appointment and continued use and supervision of
such custodian or agent. Furthermore, except in the case
of personal injury or death, the depository’s liability to a
holder of depository interests will be limited to the lesser
of: (i) the value of shares and other deposited property
properly attributable to the depository interests to which
the liability relates; and (ii) that proportion of £10 million
which corresponds to the portion which the amount the
depository would otherwise be liable to pay to the holder
of the depository interests bears to the aggregate of the
amounts the depository would otherwise be liable to pay
all such holders in respect of the same act, omission or
event which gave rise to such liability or, if there are no
such amounts, £10 million.
The depository is entitled to charge fees and expenses for
the provision of its services under the Deed Poll without
passing any profit from such fees to holders of depository
interests.
Indemnification
Each holder of depository interests is liable to indemnify
the depository and any custodian (and their agents,
officers and employees) against all costs and liabilities
arising from or incurred in connection with, or arising from
any act related to, the Deed Poll so far as they relate to
the property held for the account of depository interests
held by that holder, other than those resulting from the
willful default, negligence or fraud of the depository, or
the custodian or any agent, if such custodian or agent
is a member of the depository’s group, or, if not being
a member of the same group, the depository has failed
to exercise reasonable care in the appointment and
continued use and supervision of such custodian or agent.
United States ownership and transfer restrictions
There are restrictions on the purchase of ordinary shares
by or transfers to investors who are located in the United
States or who are US persons (as defined in the United
States Securities Act of 1933, as amended) or who acquire
ordinary shares or realisation shares for the account
or benefit of US persons. For a complete description of
these ownership and transfer restrictions please refer to
section 4 of Part VIII of the prospectus published by the
Company on 19 October 2016.
In the event that ordinary shares are acquired by persons
who are not qualified to hold the ordinary shares or
realisation shares, such ordinary shares are subject to
provisions requiring forfeiture and/or compulsory transfer
as described in section 3 of Part VIII of that prospectus.
Other jurisdiction tax considerations
Although the Directors intend that, insofar as it is within
their control, the affairs of the Company are conducted in
such a way that the Company is tax resident in Jersey only.
There can be no guarantee that all of the requirements to
ensure this will, at all times, be satisfied and the Company
will not be considered tax resident in jurisdictions other
than Jersey.
Risk (unaudited)
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Look-Through Portfolio Information (unaudited)
As at 31 December 2022
Platform acquisition date
Carrying value attributable to the
Company’s ordinary shares
Carrying value attributable to the
Company’s 2016 realisation shares
Carrying value attributable to the
Company’s 2021 realisation shares
% voting rights held by the Marwyn Funds
% attributable to the Company’s
ordinary shares
% attributable to the Company’s 2016
realisation shares
% attributable to the Company’s 2021
realisation shares
October 2012
£19.0m
£2.2m
£0.1m
50.0%
43.5%
4.9%
0.3%
Le Chameau (Silvercloud)
Platform acquisition date
Carrying value attributable to the
Company’s ordinary shares
Carrying value attributable to the
Company’s 2016 realisation shares
Carrying value attributable to the
Company’s 2021 realisation shares
% voting rights held by the Marwyn Funds
% attributable to the Company’s
ordinary shares
% attributable to the Company’s 2016
realisation shares
% attributable to the Company’s 2021
realisation shares
Minority stake
acquired January 2022
£11.8m
£-m
£0.1m
15.4%
11.7%
-%
0.1%
AdvancedAdvT Limited
Platform acquisition date
Carrying value attributable to the
Company’s ordinary shares
Carrying value attributable to the
Company’s 2016 realisation shares
Carrying value attributable to the
Company’s 2021 realisation shares
% voting rights held by the Marwyn Funds
% attributable to the Company’s ordinary
shares
% attributable to the Company’s 2016
realisation shares
% attributable to the Company’s 2021
realisation shares
Yet to acquire a
platform asset
£9.5m
£-m
£0.06m
75.0%
56.8%
-%
0.4%
Marwyn Acquisition Company II Limited
Platform acquisition date
Carrying value attributable to the
Company’s ordinary shares
Carrying value attributable to the
Company’s 2016 realisation shares
Carrying value attributable to the
Company’s 2021 realisation shares
Yet to acquire a
platform asset
£4.9m
£-m
£0.03m
450 plc
Includes equity and debt into the Le Chameau operating group and excludes other investments made by its holding company.
The Marwyn Funds hold 100% of the voting rights of Silvercloud Holdings Limited, which in turn holds 50% of the voting rights of Le Chameau Holdings Limited
% voting rights held by the Marwyn Funds
% attributable to the Company’s ordinary
shares
% attributable to the Company’s 2016
realisation shares
% attributable to the Company’s 2021
realisation shares
95.3%
73.5%
-%
0.5%
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As at 31 December 2022
Platform acquisition date
Carrying value attributable to the
Company’s ordinary shares
Carrying value attributable to the
Company’s 2016 realisation shares
Carrying value attributable to the
Company’s 2021 realisation shares
% voting rights held by the Marwyn Funds
% attributable to the Company’s
ordinary shares
% attributable to the Company’s 2016
realisation shares
% attributable to the Company’s 2021
realisation shares
August 2015
£0.4m
£0.1m
£0.0m
12.5%
8.9%
1.3%
0.1%
Zegona Communications
Carrying value attributable to the
Company’s ordinary shares
Carrying value attributable to the
Company’s 2016 realisation shares
Carrying value attributable to the
Company’s 2021 realisation shares
% voting rights held by the
Marwyn Funds
% attributable to the Company’s
ordinary shares
% attributable to the Company’s 2016
realisation shares
% attributable to the Company’s 2021
realisation shares
Acquisition Companies
MAC III
£9.5m
£-m
£0.06m
75.0%
56 9%
-%
0.4%
MAC ALPHA
£0.5m
£-m
£-m
90.0%
69.8%
-%
-%
Look-Through Portfolio Information (unaudited)
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Advisers (unaudited)
Registered office
PO Box 309
Ugland House
Grand Cayman KY1 – 1104
Cayman Islands
Manager of the Company, the Master
Fund, MVI II LP, MVI II Co-Invest LP and
MVI II DCI I LP
Marwyn Investment Management LLP
11 Buckingham Street
London WC2N 6DF
United Kingdom
Auditor
BakerTillyChannelIslandsLimited
1st Floor Kensington Chambers
46/50 Kensington Place
St Helier
Jersey JE4 0ZE
Channel Islands, British Isles
Registrar
Link Asset Services
Mont Crevelt House
St. Sampson
Guernsey GY2 4JN
Channel Islands, British Isles
Legal Advisers to the
Company as to English law
TraversSmithLLP
10 Snow Hill
London EC1A 2AL
United Kingdom
Legal Advisers to the Company
as to Cayman Law
Maples and Calder
PO Box 309
Ugland House
Grand Cayman KY1-1104
Cayman Islands
Administrator to the Company
Aztec Financial Services (Jersey) Limited
Aztec Group House
11-15 Seaton Place
St Helier
Jersey
JE4 0QH
Channel Islands, British Isles
Corporate Broker
Liberum Capital Limited
Ropemaker Place, Level 12
25 Ropemaker Street
London EC2Y 9LY
United Kingdom
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83
Defined Terms (unaudited)
The following terms have the following meanings in this annual report and financial statements.
450 450 plc (formerly Marwyn Acquisition Company plc)
Administrator the administrator of the Company from time to time, being Aztec Financial Services (Jersey) Limited as at the date
of this annual report and financial statements
AdvT or AdvancedAdvT AdvancedAdvT Limited
AIC Association of Investment Companies
AIC Code the AIC Code of Corporate Governance
Articles the articles of association of the Company
AGM Annual General Meeting
Audit Regulation Article 26 (6) of Regulation 538/2014
Aztec Aztec Financial Services (Jersey) Limited
Board Board of Directors of the Company
Bradshaw Taylor Bradshaw Taylor Limited
Broker the corporate broker appointed by the Company from time to time, being Liberum Capital Limited as at the date of
this annual report and financial statements
BTCI Baker Tilly Channel Islands Limited
CEO Chief Executive Officer
COO Chief Operating Officer
Company/Fund Marwyn Value Investors Limited
Companies Law the Cayman Islands Companies Law (2013 Revision)
Directors Board of Directors of the Company
ESG Environmental, Social and Governance
Exchange Procedure has the meaning given to it in the in the prospectus published by the Company on 19 October 2016
Euskaltel Euskaltel, S A.
EV Enterprise value
FCA Financial Conduct Authority
IFRS International Financial Reporting Standards as adopted by the European Union
Investment securities in any of the Marwyn Funds
IPEV Guidelines the International Private Equity and Venture Capital valuation guidelines as amended
IPO Initial Public Offering
Le Chameau The Le Chameau operating group, the Master Fund’s investment in which is held through
Silvercloud Holdings Limited
Liberum Liberum Capital Limited
London Stock Exchange or LSE London Stock Exchange plc
LTIP Long Term Incentive Plan
MAC II Marwyn Acquisition Company II Limited
MAC III Marwyn Acquisition Company III Limited
MAC Alpha MAC Alpha Limited
Management Partner has the meaning given to it in the Report of the Manager
Manager The manager of the Company from time to time, being Marwyn Investment Management LLP as at the date of this
annual report and financial statements
MAR The UK version of EU Regulation 596/2014 which forms part of UK law by virtue of the European Union
(Withdrawal) Act 2018, as amended
Marwyn The Manager and any other Marwyn entities with the same ultimate beneficial owners
Marwyn Funds The Company, the Master Fund, MVI II LP and any other funds managed by the Manager
Master Fund Marwyn Value Investors LP
Minimum Annual Distribution has the meaning given to it in the Ordinary Share Distribution Policy
MLTI Marwyn Long Term Incentive LP
MVI II LP Marwyn Value Investors II LP
NAV Net Asset Value
Net Capital Gain has the meaning given to it in the Company’s RNS announcement dates 14 August 2018
Ordinary Share Distribution Policy The Company’s policy on distributions to ordinary shareholders as described in the Company’s circular
published on 14 August 2018 circular, included in the ‘Documents’ section of the Company’s website,
www.marwynvalue.com
Portfolio Companies the entities into which the Company indirectly invests through the Master Fund and/or MVI II LP as relevant
PwC PricewaterhouseCoopers LLP
Realisation Class Ordinary shares that are redesignated as realisation shares following receipt of valid elections to redesignate
such Ordinary Shares as realisation shares, in accordance with the Articles, of which there are currently
two such classes; the 2016 Realisation Class and the 2021 Realisation Class
Realisation Pool Assets attributable to the realisation shareholders, of which there are two such pools relating to the 2016
Realisation Class and the 2021
Realisation Class Relevant Entities the Manager or any member of the Marwyn group or any of their respective advisers or affiliates
or the Marwyn Funds
SORP Statement of Recommended Practice
SPAC Special Purpose Acquisition Vehicle
Specialist Fund Segment or SFS the specialist fund segment of the main market of London Stock Exchange plc
Sterling British Pounds Sterling
Zegona Zegona Communications plc
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Disclaimer (unaudited)
The report of the Manager (“Manager’s Report”) is
issued by Marwyn Investment Management LLP, a Firm
authorised and regulated by the FCA, in connection with
the Company, the Master Fund, MVI II LP and any other
funds managed by the Manager (collectively, the Marwyn
Funds).
The Manager’s Report does not constitute a prospectus
or offering document relating to the Marwyn Funds, nor
does it constitute or form part of any offer or invitation
to purchase, sell or subscribe for, or any solicitation of
any such offer to purchase, sell or subscribe for, any
securities in the Marwyn Funds (an “Investment”) nor
shall the Manager’s Report or any part of it, or the fact
of its distribution, form the basis of, or be relied on in
connection with, any contract therefor.
Persons who wish to make an Investment are reminded
that any such Investment should only be made on the
basis of the information contained in materials provided
for that purpose for your consideration and not on the
information contained in the Manager’s Report. No
reliance may be placed, for any purposes whatsoever, on
the information contained in the Manager’s Report or on
its completeness and the Manager’s Report should not
be considered a recommendation by the Manager or any
member of the Marwyn group or any of their respective
advisers or affiliates or the Marwyn Funds (the Relevant
Entities) in relation to an Investment.
No representation or warranty, express or implied, is
given by or on behalf of the Relevant Entities or any of
their respective directors, partners, officers, employees,
advisers or any other persons as to the accuracy,
fairness or sufficiency of the information or opinions
contained in the Manager’s Report and none of the
information contained in the Manager’s Report has
been independently verified by the Relevant Entities or
any other person. Save in the case of fraud, no liability
is accepted for any errors, omissions or inaccuracies in
such information or opinions.
The distribution of this document in certain jurisdictions
may be restricted by law and the persons into whose
possession this document comes should inform
themselves about, and observe, any such restrictions.
The Manager’s Report includes “forward-looking
statements” which includes all statements other
than statements of historical facts, including, without
limitation, those regarding the Master Fund’s and the
Company’s financial position, business strategy, plans
and objectives of management for future operations and
any statements preceded by, followed by or that include
forward-looking terminology such as the words “targets”,
“believes”, “estimates”, “expects”, “aims”, “intends”, “can”,
“may”, “anticipates”, “would”, “should”, “could” or similar
expressions or the negative thereof. Such forward-
looking statements involve known and unknown risks,
uncertainties and other important factors beyond the
control of the Marwyn Funds that could cause the actual
results, performance or achievements of the Marwyn
Funds to be materially different from future results,
performance or achievements expressed or implied
by such forward-looking statements. Such forward-
looking statements are based on numerous assumptions
regarding the present and future business strategies of
the Marwyn Funds and the environment in which the
Marwyn Funds will operate in the future.
These forward-looking statements speak only as at
the date of the Manager’s Report. Investing in the
Company involves certain risks, as detailed in these
financial statements, and as described more fully in the
prospectus published by the Company on 19 October
2021.
Indices are used solely for comparison purposes.
There are limitations in using indices for comparison
purposes because, among other reasons, such indices
may have different volatility, diversification, credit, and
other material characteristics (such as number or type
of instrument or security). Whilst investors can invest
in index tracker funds, they cannot invest directly in an
index. FTSE All-Share Source: London Stock Exchange
Group plc and its group undertakings (collectively,
the “LSE Group”). © LSE Group 2023. FTSE Russell is a
trading name of certain of the LSE Group companies.
“FTSE Russell®” is a trade mark of the relevant LSE
Group companies and is/are used by any other LSE
Group company under license. All rights in the FTSE
Russell indexes or data vest in the relevant LSE Group
company which owns the index or the data. Neither
LSE Group nor its licensors accept any liability for any
errors or omissions in the indexes or data and no
party may rely on any indexes or data contained in this
communication. No further distribution of data from the
LSE Group is permitted without the relevant LSE Group
company’s express written consent. The LSE Group does
not promote, sponsor or endorse the content of this
communication.
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MARWYN VALUE INVESTORS LIMITED