David Fleer of Bristlecone Value Partners presented his in-depth investment thesis on Steel Partners Holdings LP (NYSE: SPLP) at Best Ideas 2018.

Steel Partners Holdings LP is a publicly-traded limited partnership in the process of transforming itself from a collection of minority stakes in public companies into an owner primarily of operating businesses. Steel Partners now owns a diverse collection of industrial businesses, an oil and gas services business, and a most unusual bank, alongside significant remaining non-operating assets (and liabilities). The company is managed by capable owner/operators with significant alignment of interests through 52% insider ownership. David believes the market—to the extent it’s paying any attention at all—may be mispricing Steel Partners due to its complicated structure and less-than-transparent accounting. As the company simplifies, the discount to intrinsic value may narrow; absent that, David believes operating results and good capital allocation will allow value to compound at an attractive clip.

About the instructor:

David Fleer started his career in investment management in 1996. Prior to founding Bristlecone in 2004, David was a Senior Vice President and US equities portfolio manager/analyst at Oppenheimer Investment Advisers. David grew up in North Carolina, then moved to Massachusetts, where he earned a Bachelor of Arts degree in history from Amherst College (Amherst, MA) and a Master of Arts degree in art history from Williams College (Williamstown, MA), with a focus on Italian Renaissance. Researching and discussing investment ideas around the conference room table, it turns out, is not all that different than discussing Leonardo around the seminar table. David now lives in Los Angeles, California, with his wife, son and daughter. David has managed not to gain too much weight eating at Clementine, his wife’s bakery café, attempting to burn off the calories by playing and coaching (and sometimes just watching) soccer, among other pursuits.

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