The UDF opportunity is now closed.
UDF IV was a fund created by Texas based United Development Funding (“UDF”). UDF provided funding to real estate developers as a alternative to typical bank lending for bridge or development finance.
Previously, we understood that the SEC alleged that UDF started using cash from UDF IV to bailout the previous fund UDF III, the SEC alleged that those transactions were improper and not adequately disclosed.
UDF struggled since the allegations to find advisors and accountants to support its listing and as a resulted the shares were de-listed in Q3 2016.
Whilst UDF maintains that there was a large untapped NAV behind the shares of UDF IV, shareholders received only small distributions since the de-listing, with amounts of between 0.01 and 0.09 from our records.
Prior to the de-listing the shares traded as low as $2.76 and with the current level of average distributions of $0.05 it would take c. 56 years to pay out the NAV that management say they have.
Southey Capital offered to purchase the securities to allow shareholders to exit their illiquid investment,
Security Identifiers:
ISIN US9101871039
CUSIP 910187103
SEDOL1 BN65T13 US
Common 110526580
WPK # A11569
