Livermore’s Steady Climb: CLOs Shine, Fetcherr Flexes, and Cash Cushion Comforts
In a year where many investors white-knuckled their way through geopolitical tremors and stubborn inflation, Livermore Investments delivered a reassuringly steady performance. Let’s unpack their 2024 RNS announcement – and why this BVI-based fund might just be the tortoise outpacing hares in today’s market.
By the Numbers: NAV Growth & Dividend Delight
- 2.5% NAV increase to $0.84 per share (from $0.82 in 2023)
- $7m dividend paid ($0.0423/share) with total net return of ~7%
- $44.2m war chest in cash/government bonds – nearly a third of total assets
While net profit halved to $6.6m (from $13.9m), this was largely due to strategic reinvestment rather than operational weakness. The real story? Livermore’s playing the long game – and their CLO engine is purring.
CLOs: The Cash Machine You’ve (Probably) Never Heard Of
Collateralized Loan Obligations – essentially bundles of corporate loans repackaged into tranches – delivered $22m in cash distributions and $10.3m net gains. With defaults staying below historical averages and refinancing activity booming, Livermore’s BB/B tranche trades and warehouse conversions (hello Blackstone and MJX) proved prescient.
Why This Matters Now:
- Floating rate nature protects against Fed’s “higher for longer” stance
- Tight credit spreads forced selective positioning – hence those lightly-ramped PGIM/Blackstone warehouses
- “CLO equity optionality” could pay dividends if 2025 brings volatility
Fetcherr: From Niche Player to AI Pricing Powerhouse
This Israeli AI pricing disruptor for airlines isn’t just surviving – it’s thriving. After raising $25m at a $250m valuation (4x 2023’s $67m), Livermore doubled down with $9.9m secondary investment to maintain its 11.5% stake. With marquee clients like Virgin Airlines and Azul Air, Fetcherr’s real-time dynamic pricing could redefine airline yield management.
Financial Fort Knox: Liquidity as Strategic Weapon
That $44.2m cash/bond position isn’t timidity – it’s tactical. With:
- US loan spreads at cycle lows
- Trump 2.0 trade wars looming
- CLO refinancing wave peaking
…Livermore’s dry powder positions them to pounce on dislocations. As CEO Noam Lanir notes: “Higher rates pay us to wait while excesses correct.”
Risks & Watch Points
- CLO vintage risk – older structures more exposed to default ‘tail risks’
- Fetcherr’s B2B SaaS scaling challenges
- Operational expenses up 70% to $5.6m – needs monitoring
The Bottom Line: Steady Hands, Strategic Bets
Livermore’s 2024 playbook – CLO opportunism, private equity patience, and liquidity discipline – reflects lessons hard-learned from multiple market cycles. While not flashy, their 7% total return in a “meh” year for fixed income suggests this isn’t your typical yield-chasing fund.
As rates plateau and AI-driven productivity gains start biting across industries, Livermore’s dual focus on cash-generating credit and tech-enabled growth plays could prove remarkably timely. One to watch – preferably from the cozy confines of their $44m cash bunker.
