Berkshire Boosts Apple Stake 55%
Apple
Warren Buffett’s Berkshire Hathaway (BRK.A/BRK.B) started investing in Apple (NASDAQ:AAPL) this year and added during the past quarter. Today, they own a $1.5 billion position. This position could be impacted by the rollout of new iPhones next month as well as potential federal antitrust litigation. For more on Berkshire’s stake in Apple, you can listen to Warren Buffett’s Bucket List – From Apple To Yahoo!
Andrew Spokes’ Farallon Capital built a new position in LinkedIn (NYSE:LNKD). They bought 920,000 shares in this definitive deal target. The target’s shareholder approval dashed hopes for an overbid from Salesforce (NYSE:CRM), but there remains a decent arb spread of $4.49 which offers a 9% IRR if the deal closes in November.
Rite Aid
David Einhorn’s Greenlight Capital just established a new position in Rite Aid (NYSE:RAD). He bought over ten million shares of the deal target. The $1.24 arb spread offers a 65% IRR if the deal closes in November. We discussed this opportunity on our podcast.
While the spread is still quite wide, it has recovered somewhat since I last discussed it.
Monsanto
Dan Loeb’s Third Point recently bought a new position in Monsanto (NYSE:MON), the much maligned target of anti-GMO pseudoscience. Their two million shares are currently worth over two hundred million dollars. If Bayer (OTCPK:BAYRY) buys it, the deal would be the biggest of the year and the largest German acquisition ever. You can listen to more in Does Bayer need protection from Monsanto?
EMC
John Paulson’s Paulson & Co. built up a new position in EMC (NYSE:EMC) in Q2. They bought over ten million shares worth well over a quarter of a billion dollars. EMC is the target of history’s largest tech deal – its acquisition by Dell. The deal is unconditional and expected to close shortly. The deal’s closing will leave Paulson with a substantial stake in the VMware (NYSE:VMW) tracking stock. This tracker was available for free earlier this year.
Media General
In the most recent quarter, Jonathan Auerbach’s Hound Partners bought a new two million share stake in Nexstar (NASDAQ:NXST) target Media General (NYSE:MEG), the subject of our second podcast, Trick or Treat with Media General.
Sifting the World members should check out Catalysts Drive Media General’s 20% Upside to learn more.
Liberty Braves
Seth Klarman’s Baupost Group has a new position in Liberty Braves (BATRA/BATRK) worth about $56 million. The tracking stock was just mentioned in the latest issue of Barron’s:
Surprisingly, the piece did not discuss the recent Disney (NYSE:DIS) investment in a one-third stake in the MLB Advanced Media (MLBAM) video-steaming unit. The deal values the business at $3.5 billion. The remaining two-thirds is jointly owned by the Braves and the other 29 baseball teams. You can listen to more on this company in How To Own Your Own Major League Baseball Team For Less Than $20. StW members can get additional insights here.
Conclusion
At Rangeley Capital, we do not rely on anyone else’s conclusions in our research. We spend all our time sifting through primary source materials to find a handful of securities that the market, for one reason or another, is willing to sell to us for a substantial discount. While we spend every other day engaged in primary research into our own ideas, one day each quarter it is worth glancing at what other funds are up to. These ideas are some of our favorites from the handful of money managers that are truly exceptional.
Disclosure: I am/we are long BRK.A, BRK.B, LNKD, RAD, MON, EMC, MEG, BATRK.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Unique Finance). I have no business relationship with any company whose stock is mentioned in this article.
Additional disclosure: Chris DeMuth Jr and Andrew Walker are portfolio managers at Rangeley Capital. We invest with a margin of safety by buying securities at discounts to their intrinsic value and unlocking that value through corporate events. To maximize returns for our investors, we reserve the right to make investment decisions regarding any security without notification except where notification is required by law. We manage diversified portfolios with a multi-year time horizon. Positions disclosed in articles may vary in sizing, hedges, and place within the capital structure. Disclosed ideas are related to a specific price, value, and time. If any of these attributes change, then the position might change (and probably will).
Editor’s Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.
