John Paulson Reduces Centamin Egypt Position ~ market folly

Thursday, July 22, 2010

John Paulson Reduces Centamin Egypt Position

John Paulson's hedge fund firm Paulson & Co has reduced its stake in Centamin Egypt to below 5% (the company is traded in London under the ticker CEY and on the pink sheets as CELTF). Centamin is a mineral exploration and development company focused in Egypt and has over 13 million ounces of gold resources at its Sukari gold project, one of the largest single deposits outside of the majors. While the rationale behind Paulson's sale is unknown, he has certainly fared well on this investment, earning approximately 200%. Given that this was a gold focused investment, it most likely was a part of Paulson's gold fund.

Regulatory disclosures in UK markets only require that Paulson reveal when his position goes below a 5% stake. As such, it's unclear as to whether or not he merely sold below that level or sold out of this position entirely. Unfortunately, we won't know unless Paulson & Co provides some sort of commentary on the matter. Back in February of 2009, Paulson's stake in Centamin Egypt was as high as 11.16% of shares outstanding. Conclusively, one thing is certain: Paulson has reduced his stake.

John Paulson of course became well known in the financial world for his bet against subprime and his amazing story is detailed in The Greatest Trade Ever. While he had modest beginnings as a merger arbitrage fund manager, he has since expanded to various other strategies including his gold fund and a recovery fund. For the rest of his equity positions, head to John Paulson's portfolio.

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