20th Feb 2026 11:30
(Alliance News) - Chrysalis Investments Ltd on Friday proposed to sell its entire portfolio and return proceeds to shareholders over the next three years.
The Guernsey-based, UK and Europe-focused investor said the discount to net asset value at which its shares trade "has not improved significantly". This is despite buybacks worth more than GBP100 million over the last two years.
Chrysalis shares rose 0.1% to 95.30 pence on Friday morning in London, but are down 4.7% over the past year.
The firm estimated that a share price of 95p represented a 34% discount to its blended subscription price across the shares issued for cash since inception, which Chrysalis put at 145p.
Based on historic trends, Chrysalis sees the return of capital via realisations as "more appropriate" than reinvesting in new businesses.
Its new investment policy "is to effect an orderly realisation of its assets in a manner that is consistent with the company's investment objective and the principles of good investment management," Chrysalis said.
Its shareholders will meet to consider the proposal on March 24.
Chrysalis also noted that it had entered a new investment management and advisory agreement with Chrysalis Investment Partners LLP when it adopted a new capital allocation policy, back in March 2024. CIP is a vehicle formed by Richard Watts and Nick Williamson, with G10 Capital Ltd as the alternative investment fund manager. Chrysalis said it had hoped that CIP "would be well positioned and funded to build out its own regulatory and operational capacity" but that the investment advisor "has not developed its regulatory and operational capacity as envisaged".
CIP on Friday said it will continue to work "constructively" with Chrysalis, to reach "arrangements that are in the best interests of all shareholders", noting that such arrangements would need to reflect the new investment policy.
According to CIP, the Chrysalis board has proposed that CIP's two fund managers provide part-time consulting services for a fixed five-month period following termination of the current arrangements.
"A part-time consulting model of limited duration would not provide the continuity, accountability and sustained focus required at this critical stage in the company’s lifecycle and risks impairing, rather than protecting, shareholder value," CIP argued, expressing concern over the possibility of Chrysalis adopting "a self-managed option".
CIP claimed that the Chrysalis board does not share its insight into the companies which make up the Chrysalis portfolio. It was also concerned about Chrysalis losing representation at Starling Bank, which CIP estimated to comprise "more than half" of the portfolio's net asset value.
"Nor does the board, whose role it is to provide governance and oversight, have the expertise to run an investment mandate, even one in wind-down," CIP added.
"The board is not incentivised to maximise value, whereas [CIP] is fully aligned with shareholders. A significant proportion of the investment team’s personal wealth is invested in the company. Their interests are directly tied to maximising value for all shareholders over a reasonable period," CIP stressed.
"This is a moment for stability, common sense and the protection of shareholder value - not disruption that places shareholder returns at unnecessary risk," the manager concluded.
By Holly Munks, Alliance News reporter
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