Kelso Group Holdings is a small London-listed investment company. It holds fewer than ten UK small and mid-cap shares and presses their boards on strategy, capital allocation and communication with investors. After two flat years, its net asset value (NAV) per share rose from 2.3p at the end of 2025 to 3.3p by 31 August 2026. Borrowing of about a third of net assets and a few sharply higher holdings drove that rise, and most of the portfolio sits in four shares.
Ten shares, one idea
Kelso buys stakes in established, profitable UK companies, mostly market leaders. Its holdings are Saga, CVS Group, The Works, NCC Group, Likewise Group, Angling Direct, Selkirk Group and THG. It avoids early-stage companies and resources. The average holding is worth about £320m, and the board says six of the ten have net cash.
Kelso earns its return from share-price gains, not fees. Consultancy income was £25k in the first half of 2026, against £236k of administrative costs. The board owns about 16% of the company. A management incentive plan, settled in shares, rewards the team. 2 Sep 2026 30 Apr 2026 30 Apr 2024
“Kelso's founding belief: if a listed company's asset allocation and investor relations execution improve, so too will its share price.” 2 Sep 2026
A cash shell turns activist
Kelso was a listed cash shell from July 2021. In November 2022 a new board under chairman Sir Nigel Knowles dropped the search for a reverse takeover and chose to back undervalued small caps instead. It raised £3m at 2.0p and £3m at 2.5p in 2023, then £1.9m at 3.0p in January 2024.
The first year went well. Kelso bought THG, NCC, Angling Direct and The Works and booked a £2.6m investment gain, a 55% return against a 25% annual target. It then pushed for change. In February 2024 its CEO and CFO joined The Works' board, and they left it in October 2024. It urged THG to demerge its three businesses and said in May 2024 it would vote against THG's chair. 23 Apr 2025 30 Apr 2024 12 Jan 2024 14 Feb 2024 1 Oct 2024 7 Dec 2023 21 May 2024
Two flat years and a shell with no deal
Returns stalled. In 2024 gross investment returns were about -1%, and NAV per share stayed at 2.4p. The first half of 2025 was flat again. The shares reached 4.1p in October 2024, then fell to 2.0p in April 2025. The target stayed in place, and the chairman wrote that it would need 'strong performance throughout the remainder of 2025'.
Kelso also seeded Selkirk, an AIM-listed cash shell that raised £7.5m in November 2024, with Kelso holding 18%. Selkirk has not announced an acquisition. Its shares fell 35% in 2025 to 1.85p, and the company said this held back performance. NAV per share ended 2025 at 2.3p. The Works was the exception, rising 70% in 2025 after repeated upgrades to its profit guidance. 23 Apr 2025 7 Nov 2024 30 Apr 2026 30 Sep 2025 25 Jun 2025 30 Sep 2024
“Our target return since inception has been 25% per annum.” 23 Apr 2025
2026: new names, borrowing and a rebound
A December 2025 raise of £2.05m at 3.0p funded new positions. Kelso bought Saga in January 2026 at about 387p, CVS in February at about 1,387p and Filtronic in April at about 185p. It sold Filtronic by June at about 406p, a 119% gain in under six months. Later it added Likewise, a flooring distributor, buying 5m shares for £2m at 30p in October.
The Works rose 155% in the year to 31 August on guidance upgrades. In May 2026 NCC completed the £275m sale of its Escode software-escrow division to TDR Capital. Kelso had expected NCC's cyber security business to be sold in 2026. Instead NCC is returning £185m to shareholders and will continue as a standalone cyber firm. Pre-tax profit for the first eight months of 2026 was £4.8m, from net assets of £10.3m at the start of the year. Kelso also paid 7.8% interest on its borrowings. 16 Dec 2025 17 Dec 2025 6 Jan 2026 17 Feb 2026 27 Apr 2026 23 Jun 2026 22 Jan 2026 8 Oct 2026 2 Sep 2026
What explains the record
Results have come from a few large positions, not steady progress. THG was 52.5% of the portfolio at the end of 2023 and The Works was 24% in August 2026. When one holding moved, so did Kelso. The Works, the best performer, rose from about 31p to 87p after Kelso's first purchase. Selkirk, which holds only cash, dragged on results while it waited for a deal.
The market also set the pace. Kelso said small caps lagged larger shares for years and had only begun to recover. Its own judgement is hard to separate from that timing. The 25% target was stated in January 2024 and restated in 2024 and 2025. The 2026 reports do not repeat it. They describe the aim as 'market leading compounded annual returns'. 30 Apr 2024 2 Sep 2026 30 Apr 2026 23 Apr 2025 30 Sep 2025
Small team, thin costs, rising leverage
Sir Nigel Knowles is chairman, John Goold is chief executive and Jamie Brooke is chief investment officer. Mark Kirkland left as CFO in September 2025. Ian Selby now serves as part-time finance director, and he bought small amounts of shares in 2026. Costs are low. Operating costs were under £1m in three and a half years, and the board drew under £100k in salaries. Modest board salaries start in the second half of 2026.
Management's capital allocation has changed. In September 2025 it planned gearing of at most 20% of net assets. By August 2026 gearing was 33%, which it justified by the net cash held by six holdings. The board's stake has fallen from about 21% in 2024 to about 16% through new share issues. In September 2026 Kelso raised another £3.2m at 3.3p, a 5.7% discount to the previous close for the retail offer. The proceeds go mainly to existing holdings that are still building. 30 Sep 2025 30 Apr 2026 2 Sep 2026 10 Sep 2026 21 Sep 2026 30 Sep 2024
Where it stands
At 31 August 2026 Kelso had net assets of £15.2m, or 3.3p a share, and gross investments of £23.0m. The Works was 24% of the portfolio, and NCC, Saga and CVS were 15%, 15% and 14%. Management says its 43% eight-month gain puts it in the top decile of UK small-cap investors. That is its own claim. After the September raise Kelso had about 560.7m shares. The latest close was 3.6p on 19 October 2026.
Kelso is also in a fight at The Works. It proposed Graeme Coulthard, a retail executive who holds 8% of the company, as a director. The Works' board advised shareholders to reject him, and the vote was due on 7 September 2026. The company has not reported the result. In October it raised its Saga holding to 600,000 shares at an average of 446p. 2 Sep 2026 21 Sep 2026 17 Aug 2026 5 Oct 2026
What Kelso expects next
Kelso says it will stay small and hold about ten stocks. It plans a 'material' tender-offer buyback in December 2028, first stated in September 2026, and hopes for further NAV gains before then. It wants a wider shareholder register and more institutional holders. Its holdings have their own targets. Saga wants over £100m of pre-tax profit and leverage below 2x by January 2030. The Works targets at least £22.5m of EBITDA by 2030. Likewise expects revenue above £200m in 2026.
Several questions will decide the outcome. Kelso has not said what Selkirk will buy. NCC's cyber business has to work as a standalone company. A small, concentrated and geared portfolio is exposed to any one setback, and the company says liquidity in its shares is limited. 2 Sep 2026 10 Sep 2026 5 Oct 2026 30 Apr 2026 8 Oct 2026 22 Jan 2026
Written by AI from Kelso Group Holdings's own announcements since Oct 2023 · every paragraph links to its sources