Former Dunloe Ewart chairman Noel Smyth has built up a 10% stake in split-cap property fund Real Estate Opportunities (REO), sparking speculation that he may launch a bid.
Yesterday, REO announced that Smyth had bought 4.5m shares, taking his holding to more than 20m shares, a 10.3% stake.
REO’s share price has fallen heavily over the past year, after it suffered heavy losses on investments in junk bonds and in other split-cap funds.
This came at a time when the whole split-cap sector had been rocked by scandal, after thousands of investors lost millions of pounds prompting an ongoing Financial Services Authority (FSA) investigation.
However, REO has a £425m property portfolio which has performed well and grown in value, while its market capitalisation is only £87m.
REO’s other main shareholders are Treasury Holdings, the Irish developer which set up the fund with Aberdeen Asset Management, and boutique investment bank Dawnay Day.
Since leaving Dunloe Ewart after failing to stave off a bid by Liam Carroll, Smyth has been building up a UK portfolio with £164m of acquisitions.
References: EGi News 15/07/03
