Excelsior’s Stagnant Shares Raise Red Flags as London City Prepares Court Fight
London City reports a record investment portfolio value of $27.3 million, buoyed by strong gains in Fiducian Group shares, while legal proceedings against Excelsior Capital and its directors continue to unfold.
- Investment portfolio reaches record $27.3 million with $11 million in cash
- Fiducian Group shares deliver significant capital gains
- Excelsior Capital shares underperform with minimal price growth
- Net assets estimated at 78.2 cents per share, tax loss benefits reduced
- Ongoing legal action against Excelsior and its directors scheduled for February 2026
Record Investment Portfolio and Strong Liquidity
London City has announced a milestone in its investment portfolio, which now stands at a record $27.3 million. This includes $16.3 million in equities and a robust cash and cash equivalent position of $11 million, underscoring the company’s strong liquidity in a volatile market environment. The board expressed satisfaction with this performance, highlighting the portfolio’s resilience amid ongoing economic uncertainties.
Fiducian Group Drives Capital Gains
A key contributor to this growth has been the Fiducian Group shares, which have appreciated by over 10% since the start of the year. London City had previously trimmed its Fiducian holdings below 5% last October, realising a capital gain of $6.9 million. Subsequent partial sales have added another $2.3 million in gains, reflecting the board’s strategic management of this long-held investment.
Concerns Over Excelsior Capital’s Performance
In contrast, Excelsior Capital, in which London City holds a 9.1% stake, has seen its share price stagnate, rising only 1.2% this year despite broader market highs. The board voiced serious concerns regarding Excelsior’s $37.8 million investment in alternative asset funds, noting a lack of transparency and communication from Excelsior’s management. London City plans to engage other shareholders to assess collective sentiment and may call a shareholder meeting to address these issues.
Net Asset Position and Tax Implications
London City’s estimated unaudited net assets now stand at $24.5 million, or 78.2 cents per share. The recent capital gains have reduced the company’s past tax losses to approximately $3.5 million, diminishing future income tax benefits. Nevertheless, the board views the strong cash position as a significant advantage in navigating current market volatility.
Ongoing Legal Proceedings Against Excelsior
The company’s legal action against Excelsior Capital and its directors remains a critical focus. London City filed for the winding up of Excelsior on just and equitable grounds in April 2024. After a change in legal representation and amendments to the claim, the Federal Court has scheduled the hearing for February 16-19, 2026. The board cautions shareholders that progress is unpredictable but emphasises the importance of this litigation for protecting shareholder interests.
Bottom Line?
London City’s financial strength contrasts with Excelsior’s underperformance, setting the stage for a pivotal legal showdown next year.
Questions in the middle?
- How will the legal outcome against Excelsior impact London City’s future portfolio and shareholder value?
- What strategies might London City adopt if Excelsior shareholders resist calls for a meeting?
- Could further capital gains from Fiducian or other holdings offset risks from Excelsior’s underperformance?
