Information to our unit holders

We have decided to transfer the Elementa fund (ISIN SE0006852281) to ISEC Services AB (ISEC’s fund platform). Please see the attached letter for more information. The transfer will be carried out on June 1.

The fund will continue to be managed according to the same strategy and by the same portfolio manager as before, but going forward within the framework of ISEC’s fund platform.

We have worked with ISEC since the fund’s inception 11 years ago and have solid experience of their services. Today, their platform comprises more than 20 funds. When the fund was established, fund platforms were not as prevalent as they are today.

The transfer enables more efficient administration, provides access to expanded resources, and gives the portfolio manager better conditions to focus to a greater extent on investments as well as to develop the fund’s distribution. Overall, we believe this is to the benefit of the fund’s unitholders 

We remain positive on the fund’s holdings in micro- and small-cap companies. The majority of these companies have improved their results and are profitable, while the segment as a whole has gone through a challenging period, which is reasonably expected to be followed by stronger periods. Against this backdrop, we see particular value in being able to streamline the fund’s administration.

Please do not hesitate to contact us if you have any questions.

Our story and what we look for

We employ a research intense process and selection criteria like Private Equity to identify and develop investment ideas. We are passionate about allocating capital to great businesses and business people and to see them build even stronger companies over time and hence creating great value for Elementa. We look for strong growth, cash flow and companies in transition that in turn are positioned in a way which makes our probability of success high. In terms of investment style we define this approach as value-GARP, a strong emphasize on qualitative factors. We strive to find high risk/reward investment opportunities that strengthen our likelihood of success, meaning we seek alpha instead of beta. The aim of our short side is to generate absolute return besides the beneficiary effect of reducing market risk from a portfolio standpoint. With a broad network of industry professionals at our disposal we can maximize the scope of our reach, hence also maximizing our potential for great returns.

For our longs we try to find:

• Structural growth instead of cyclical growth

• Positive trends instead of turn arounds

• Trends within sector niches instead of sector and/or factor bets

• Rollup potential, in combination with organic growth and cash flows

• Cash flow generative business models

 For our shorts we try to find:

• Themes with negative business trends where we see capital outflows

• Volatile companies, cyclical and/or project based

• Companies with doubtful accounting