Kennedy Wilson (NYSE:KW) is a vertically integrated global real estate investments and services firm that is involved in every aspect of real estate. Kennedy Wilson entered the UK/Ireland market in 2011 by acquiring $1.8bn of troubled real estate from the Bank of Ireland, and later took this entity, Kennedy Wilson Europe (KWE), public in 2014 retaining a 17.7% interest. With the decision for BREXIT, KWE traded down despite limited exposure to the UK and London. Believing KWE was being significantly undervalued, management increased their ownership stake to 24% via open market purchases, and then subsequently decided to acquire the remaining portion of KWE for stock, which has led to arbitrage trading pressure on the stock. Once the transaction is complete, we believe the cost savings and a more simplified structure will enable the stock to outperform and close the discount to its net asset value.
From Keeley All Cap Value Fund second quarter 2017 shareholder commentary.
