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Core Insights - Third Avenue Management's "Third Avenue Small-Cap Value Fund" reported a return of 7.18% in Q3 2025, underperforming compared to the MSCI USA Small-Cap Value Index at 8.97% and the Russell 2000 Value Index at 12.60% [1] - The fund's performance was positively influenced by contributions from a diverse range of businesses [1] Company Specifics - Ambac Financial Group, Inc. (NYSE:AMBC) was highlighted in the fund's investor letter, with a one-month return of 3.11% and a 52-week loss of 26.73% [2] - As of November 5, 2025, Ambac's stock closed at $8.28 per share, with a market capitalization of $384.206 million [2] - Ambac is undergoing a significant transition, having received regulatory approval to sell its legacy financial guarantee business to Oaktree Capital Management, resulting in a substantial cash inflow [3] - Following the sale, Ambac announced plans to acquire ArmadaCare for $250 million, primarily funded by the proceeds from the aforementioned sale [3]

Performance Overview - The Third Avenue Small-Cap Value Fund returned 7.18% in Q3 2025, underperforming the MSCI USA Small Cap Value Index at 8.97% and the Russell 2000 Value Index at 12.60% [2] - The Fund's annualized returns for the trailing three-year and five-year periods were 15.11% and 16.09%, respectively [2] Positive Contributors - Supernus Pharmaceuticals (SUPN) was the largest positive contributor, benefiting from a strong financial position, profitability, an expanding neurology drug portfolio, and a successful acquisition [3] - Investors Title Company (ITIC) saw positive performance due to increased real estate refinancing activity [3] - UMB Financial Corporation (UMBF) successfully integrated its acquisition of Heartland Financial, showcasing operational competence [3] Negative Contributors - Atlanta Braves Holdings (BATRA) was a negative contributor, though it is perceived to have an attractive asset base and potential for favorable resource conversion [4] - UniFirst Corporation (UNF) faced pressure to demonstrate its value proposition after rejecting an acquisition offer from Cintas Corporation (CTAS) [4] - FRP Holdings (FRPH) was impacted by a lack of confidence in government spending affecting the D.C. metro area [4] Investment Strategy - The Fund focuses on acquiring companies in transitional states, aiming to capitalize on undervalued businesses with potential for future growth [5] - Investment activity emphasizes companies that are well-financed, trading at discounts to net asset value, and have identifiable levers for value creation [6] - The Fund's turnover rate is approximately 20%, indicating a long-term investment horizon of about five years, contrasting with the average turnover of 91.7% in the small-cap value fund universe [7] Types of Investment Opportunities - The Fund identifies three broad types of investment opportunities: 1. Companies facing industry-wide headwinds that can improve through restructuring [9] 2. Companies with current economic returns that have underappreciated self-help opportunities [9] 3. Event-driven situations that offer unique return profiles through transformational changes [9] Recent Transactions - Ambac Financial (AMBC) completed the sale of its legacy financial guarantee business, leading to a significant cash inflow and a transformation towards insurance distribution [11][12] - The Fund initiated new positions in Boise Cascade (BCC) and Rogers Corporation (ROG) during the quarter, while also adding to existing positions like UniFirst Corporation (UNF) [14] Company Profiles - Boise Cascade is a leading manufacturer and distributor of building materials, facing challenges due to slowing housing activity but retaining a strong financial position [15][16] - Rogers Corporation specializes in electronic and materials technology solutions, facing growth challenges but possessing valuable intellectual property and a strong balance sheet [18][19][20]

Core Insights - The Advanced Materials and Battery Council (AMBC) has appointed former Queensland Premier Annastacia Palaszczuk as its new Chair, aiming to drive national growth in Australia's advanced materials and battery value chain [2][5] - The leadership transition is expected to enhance industry collaboration, policy advancement, and support for investment and job creation across Australia [5][6] Group 1: Leadership Changes - Annastacia Palaszczuk has been appointed as Chair of AMBC, bringing extensive experience in policy delivery and industrial development [2] - Lynnard Cucksey has been appointed as interim CEO, focusing on collaboration and practical approaches to support AMBC members [5][6] - Outgoing Chair Craig Nicol expressed confidence in the new leadership team and highlighted the significant growth of Australia's advanced materials industry during his tenure [6] Group 2: AMBC's Objectives - AMBC aims to strengthen national capability and industry scale, supporting the entire value chain from upstream resources to end-of-life recovery [6] - The organization will focus on advancing priority policy settings to facilitate growth in the battery industry [5] Group 3: Company Overview - Graphene Manufacturing Group Ltd. (GMG) is a clean-technology company that develops energy-saving and energy storage solutions using proprietary graphene production processes [7] - GMG's current focus includes scaling up commercial capabilities and securing market applications for its products, such as graphene-enhanced HVAC coatings and lubricants [8][9] - The company is collaborating with the University of Queensland to develop graphene aluminium-ion batteries and improve lithium-ion battery performance [9]

Core Insights - Ambac Financial Group, Inc. (AMBC) is a financial services company focused on providing financial guarantees and risk management solutions primarily in the United States [1] Company Actions - On October 1, 2025, CEO LeBlanc Claude purchased 25,000 shares of AMBC at $8.54 per share, increasing his total ownership to 1,021,777 shares, indicating confidence in the company's future despite current financial challenges [2][6] - AMBC held an M&A call on September 30, 2025, with key leaders and Truist Securities, Inc. participants, aimed at engaging with investors and discussing strategic initiatives [3] Financial Metrics - AMBC has a negative price-to-earnings (P/E) ratio of -0.61, while its price-to-sales ratio is 1.27, indicating that investors are paying $1.27 for every dollar of sales [4] - The enterprise value to sales ratio is 1.62, reflecting the company's valuation relative to its sales, suggesting stable sales valuation despite earnings challenges [4] - The enterprise value to operating cash flow ratio is -11.53, and the earnings yield is -1.64%, highlighting difficulties in generating cash flow from operations [5] - AMBC's debt-to-equity ratio is 0.17, indicating a low level of debt compared to equity, and a current ratio of 1.86 suggests a strong ability to cover short-term liabilities with short-term assets [5][6]

Core Viewpoint - Ambac Financial Group is conducting an investor meeting to provide updates on recent transactions and business performance [1][2]. Group 1: Company Overview - The meeting is hosted by Kate Smith, Vice President and Director of Corporate Communications, indicating a structured approach to investor relations [1][2]. - Key executives participating in the call include Claude LeBlanc (President and CEO), David Trick (Chief Financial Officer), and Naveen Anand (President of Cirrata Group), highlighting the involvement of top management in communicating with investors [5]. Group 2: Financial Disclosures - The company emphasizes that forward-looking statements made during the call involve risks and uncertainties, and actual results may differ from those projected [3]. - Non-GAAP financial measures may be discussed, with reconciliations provided in recent earnings releases and other investor materials available on the company’s website [4].

Core Viewpoint - Ambac Financial Group is conducting an investor meeting to provide updates on recent business transactions and performance metrics [1][2]. Group 1: Company Overview - The meeting is hosted by Kate Smith, Vice President and Director of Corporate Communications, indicating a structured approach to investor relations [1][2]. - Key executives participating in the call include Claude LeBlanc (President and CEO), David Trick (Chief Financial Officer), and Naveen Anand (President of Cirrata Group), highlighting the involvement of top management in communicating with investors [5]. Group 2: Financial Disclosures - The company emphasizes that forward-looking statements made during the call involve risks and uncertainties, which may lead to actual results differing from those projected [3]. - Non-GAAP financial measures may be discussed, with reconciliations provided in recent earnings releases and other investor materials available on the company’s website [4].

Summary of Ambac Financial Group Investor Meeting Company Overview - **Company**: Ambac Financial Group (NYSE: AMBC) - **Recent Developments**: Successful closing of the sale of Ambac Assurance Corporation (AAC) and signing of a purchase agreement to acquire ArmadaCare from Cirrus Pointe Core Points and Arguments 1. **Transition to Specialty Insurance**: The sale of AAC marks a transformation into a pure-play specialty insurance platform, focusing on high-growth Managing General Agents (MGAs) distribution segment [4][5][6] 2. **Acquisition of ArmadaCare**: The purchase agreement for ArmadaCare, a specialty Accident & Health (A&H) platform, is a strategic move to diversify and scale the insurance distribution platform [4][16] 3. **Financial Details of Acquisition**: The acquisition price for ArmadaCare is $250 million, with an expected EBITDA of $18 million and gross revenue of $40 million, resulting in an EBITDA margin of approximately 45% [20][21] 4. **Strategic Growth Initiatives**: The company outlined six key initiatives in their 120-day post-close action plan, including a new target operating model, rebranding, compensation plan realignment, capital management, technology investments, and pursuing M&A opportunities [8][10][12] 5. **Cost Management**: The company has implemented measures to reduce executive compensation expenses and board fees, aiming for operational efficiency and lower run rate operating expenses [9][11] 6. **Investment in Technology**: Ambac is investing in data and AI technology to enhance risk management and operational efficiency, with a focus on immediate returns from these investments [12][28] 7. **Future Growth Targets**: The company aims to achieve an adjusted EBITDA of $80 million to $90 million by 2028, with a focus on organic growth and cost reductions [15][22] Additional Important Content 1. **Leadership Changes**: The departure of four executive officers and the appointment of new executives to streamline the leadership team [6][9] 2. **Shareholder Communication**: The company expressed gratitude to shareholders for their support during the regulatory approval process and emphasized the importance of aligning executive incentives with shareholder interests [5][10][22] 3. **Market Positioning**: ArmadaCare's focus on supplemental health and benefits markets is expected to enhance Ambac's portfolio and provide predictable revenue streams [18] 4. **Regulatory Approvals**: The acquisition of ArmadaCare is subject to customary regulatory approvals, with an expected close in Q4 2025 [15][20] This summary encapsulates the key points discussed during the investor meeting, highlighting Ambac Financial Group's strategic direction and financial outlook.

Strategic Direction - Ambac is transitioning into a pure-play specialty insurance platform, aiming to be the world's leading MGA Specialty Insurance platform[6] - The company is implementing a new target operating model to drive operational efficiencies and reduce operating expenses[14, 17] - Ambac is focusing on a "build and buy" strategy, demonstrated by acquisitions like Xchange Benefits, All Trans, Capacity Marine, Riverton Insurance Agency, Tara Hill Insurance services, Beat Capital Partners, Pivix and the proposed acquisition of ArmadaCare[24, 25] ArmadaCare Acquisition - Ambac proposes to acquire ArmadaCare from SiriusPoint for $250 million, representing a 138x LTM EBITDA multiple as of June 30, 2025[32, 51] - ArmadaCare's Annual Premiums in Force (APIF) as of June 30, 2025, is $148 million, with a '22-'24 Premium CAGR of 8% and an average EBITDA Margin of 46%[35] - The acquisition will be financed through a combination of cash and new debt, including a $100 million Term Loan A and a $20 million Revolving Credit Facility[23, 51] Financial Performance & Projections - Insurance Distribution Premiums Placed increased from $117 million in 2021 to $493 million in 2024 and $831 million LTM 2Q'25[25] - Pro Forma Insurance Distribution Revenue is $979 million LTM 2Q'25[25] - The company estimates Consolidated Adjusted EBITDA to Ambac to be over $80 million in 2024, with an aspiration for significant growth by 2028[29]

Group 1 - Ambac Financial Group (NYSE:AMBC) has agreed to acquire Armada Care, a supplemental health insurance program manager, for $250 million [2] - This acquisition follows Ambac's completion of the sale of its legacy financial guarantee business [2]