Author Notes:

The portfolio’s return since inception on April 2026 is roughly 3%, vs the S&P 500’s 7.7%.

The general stock market keeps on booming, and I don’t believe this type of performance is sustainable.

I make no attempt to predict where the market is going. However, I do believe speculation at levels like this will lead to the eventual reversion of price. If this occurs, prices, even of undervalued securities, will be temporarily affected.

Holdings as of May 2026:

Farmer Brothers has been successfully acquired by Royal Cup Coffee & Tea, in the expected timeframe. The deal was an all-cash transaction at $1.29 per share, and with a purchase price of $1.26, the position has returned 2.4% in just one month - equivalent to an annualized return of nearly 30%. I find the return of said investment highly satisfactory, and while I’ll continue to look for these types of special situations, I do not expect future investments to yield this annualized amount.

A new security has been added to the portfolio, Electronic Arts. The offer is $210/share in cash. Shareholder approval has been secured; however, the transaction requires extensive global regulatory reviews, including a CFIUS clearance. The probability of the deal closing within the expected timeframe, which is around mid-2026, is currently high, following reports that the final batch of international regulatory clearances was secured in early April 2026. If the deal successfully closes, we could expect an annualized return of more than 25%.

The Centessa Pharmaceutical position has been sold completely. This is due to the timeframe of the CVR payout. While the acquisition is still a high probability event, the CVR could be realistically paid in around 5 years. After evaluating the opportunity cost, this investment is not for me. The sale of Centessa has been kept in a cash sleeve for future allocation into new securities.

I have also cut the Brighthouse Financial position by half, due to state insurance regulators in the US being under pressure to be stricter with private equity firms (such as Aquarian) that buy life insurers. Both the excess gain from the successful Farmer Brothers acquisition and the cash from the sold shares in Brighthouse have been deployed into Arcontech, making it the biggest holding by far.

*General Situations & Co. is not a real or existing partnership, nor does it manage outside capital of any kind. It is simply a Substack newsletter. This is not financial advice.

General Situations & Co.

Author Notes:

I am pleased to announce the launch of General Situations & Co., an informal investment “partnership” formed to achieve long-term capital appreciation through the purchase of general undervalued securities and special situations. General undervalued securities will constitute the principal investments of the partnership while still remaining invested in special situations, derived from the successful completion of specific corporate events rather than the general level or direction of the market. This is the initial description of the General Situations & Co. portfolio, setting out its positions at inception. This section will not be used to comment on portfolio changes, rather to offer the occasional thought I find worthy of mention.

Holdings as of inception:

Notes: Generals refer to undervalued securities in which the investment outcome is determined by the appreciation of price by the market, with no meaningful catalyst as the driver of said investment. Special situations are composed of securities in which the outcome is not influenced by market fluctuations, rather by the successful completion of specific corporate events, including mergers and liquidations. These are bought below the estimate of cash that is highly probable to be received after the corporate actions are completed. Such investments are expected to continue yielding predictable returns even in adverse market conditions.

These updates will be done on a quarterly basis, or sooner should I make any changes to the holdings. In the future there will be additional charts added to these updates, reflecting the annual and YTD returns of all holdings since purchase, as well as the total portfolio return.

IMPORTANT: General Situations & Co. is not a real or existing partnership, nor does it manage outside capital of any kind. It is simply a Substack newsletter.