Active Funds

EQMC Fund:

Focus on the pan-European small cap universe:

• c. 7.000 small caps in Europe (below <€1bn market cap)
• A c. 500 target universe after applying sector, size and liquidity filters
• Take advantage of the lack of analyst coverage via own research capabilities

Key fundamental quantitative criteria are:

• Key fundamental criteria are:
  • Asset quality (ROCE)
  • Value (FCF Yield)
  • Strong earnings power generation

Key qualitative criteria

• Seek for global niche leaders exposed to global growth
• High barriers to entry with sustainable competitive advantages
• Predictable sectors

Flexibility to allocate the capital with a pan-European scope

• Focus on UK, Germany and Southern Europe
• More opportunistic approach towards other geographies

QMC Fund:

Attractive Small cap Universe (market cap < € 1bn)

• c. 150 small caps in Spain & Portugal
• High quality assets: 70% of Companies in the universe deliver historical avg. ROCE >10%
• International exposure: ≈ 50% of companies have >60% sales outside Spain
• Lack of adequate analyst coverage generates price/ value gap

Focus on top quality companies

• Key fundamental quantitative criteria are:
  • Asset quality (ROCE)
  • Value (FCF Yield)
  • Strong earnings power generation
• Key qualitative criteria:
  • Seek for global niche leaders exposed to global growth
  • High barriers to entry with long-term sustainable competitive advantages
  • Companies operating in predictable sectors

EQMC Fund

• A concentrated portfolio of 8-12 names enables for in-depth knowledge of our companies.
• The fund seeks minority but relevant ownership in targeted companies, which could range from 5-20% stakes
• EQMC searches for value whilst maintaining a midterm plan and a defined path to accelerate the value creation of investments
• The fund actively works with management teams and shareholders to either boost and/ or unlock value through an ample toolkit:
  • Capital allocation discipline
  • Strategic clarification / M&A
  • Operational efficiencies
  • Corporate governance
  • Alignment of management teams
  • Investor relations improvements
• The fund eventually nominates representation in the board of directors of investee companies

QMC II Fund:

EQMC Fund

• The investment team follows an investment process that is disciplined, thorough, well-documented and repeatable
• Multiple step due diligence targeting an constant improvement of the risk/ reward of the portfolio
• Investments typically start as small “seed” positions. Eventually, some of these become “core” investments on which an active constructive engagement is deployed
• Stringent risk controls based in-depth knowledge of the investments and patience to allocate capital

QMC II Fund

• The investment team follows an investment process that is disciplined, thorough, well-documented and repeatable
• Engagement with management’s mid-term plan in order to asses, understand and support
• Stringent risk controls based on thorough due diligence (strategic, commercial, operational, financial), shareholder analysis and management depth
• Well-structured and in-depth analysis that can take from 3 to 6 months:
  • Strong relevance of channel checks and competitive benchmarking in the commercial/ strategic due diligence;
  • Margin of safety as a key principle when valuing a company

• Investments are typically built up through either block trade or open market

EQMC Fund

• The key people at the EQMC fund are:
  • Francisco De Juan: Portfolio Manager
  • Jacobo Llanza: CEO of Alantra Asset management
  • 5 investment analysts fully dedicated to the fund with strong international experience and multi-skilled background
• Support by several senior advisors and investment consultants in the different geographies

QMC II Fund

• The key people at the QMC II fund are:
  • Julián Cepeda: Portfolio Manager
  • Jacobo Llanza: CEO of Alantra Asset management
  • 4 investment analysts fully dedicated to the fund with multi-skilled background
• Support by several senior advisors and investment consultants