Kestrel specializes in analyzing restructurings, such as corporate share repurchases, spin-offs and asset sales, in order to identify companies where management is actively working to increase shareholder value. Our experience and research, over more than thirty years, convince us that companies selected from this segment are more likely to produce superior long-term returns for their shareholders. We invest in companies with managements who have implicitly or explicitly identified their stock as undervalued and who are taking concrete steps to improve their share valuation. For this reason, we find the risk/return relationship of our approach to be particularly attractive. Kestrel’s small-cap orientation stems from our observation that shares of companies lacking institutional coverage are more likely to be inefficiently priced. We also find that companies in the small-cap arena provide us with clearer management signals, an important component of our investment process. In contrast, restructurings at larger capitalized companies are undertaken more regularly, and are motivated by a host of other factors unrelated to share valuation.