Hedge Fund Lone Pine Reduces UK Exposure ~ market folly

Friday, November 20, 2009

Hedge Fund Lone Pine Reduces UK Exposure

On Wednesday we took a look at Lone Pine’s holdings in the US and today we are going to follow that up with an update on their UK positions. We last looked at Lone Pine’s UK holdings back in August. Since then, most of the action has been in one direction: Stephen Mandel’s Lone Pine has been selling out of UK companies. There are no new positions and only one increased position to report.

Of course we don’t know why Mandel has been reluctant to make new acquisitions in the UK. However, it is worth remembering that the UK was one of the countries hardest hit by the banking crisis and one of the slowest to recover from recession despite the fact that the Bank of England has been among the most aggressive ‘quantitative easers’. The fact that a savvy hedge fund manager like Mandel is reducing his exposure perhaps does not bode well for UK PLC generally.

The tables below start with the date of the disclosure on the left (in UK format), the amount of shares owned in the middle, and the ownership percentage stake on the right.

Increased positions:

Intertek Group Plc ITRK 23/07/2008 9920265 6.29

01/08/2008 12040798 7.63

04/08/2008 12613798 8

12/08/2008 14282572 9.05

17/10/2008 15879234 10.06

27/10/2008 18388766 11.65

20/11/2008 19138766 12.13

01/06/2009 18995931 11.99

Intertek (LSE: ITRK) provides testing, inspection and safety services to a range of companies involved in consumer goods, building, telecoms, autos, oil, chemicals, pharmaceuticals, mining and agriculture. It also provides trade services to public standards bodies and governments.

Closed Positions: Lone Pine reduced their holdings below 3 percent of outstanding equity in the following companies.

- Autonomy (AU)

- Michael Page (MPI)

Once a hedge fund’s position falls below 3 percent of equity it no longer has to disclose holdings in the UK. One could assume that given their pattern of selling that they have closed the positions entirely, but there's no sure way for us to verify that right now.

Decreased Positions:

Rightmove RMV 25/03/2008 11429616 9.72

21/08/2009 1004087 8.5

24/08/2009 9051477 7.7

25/08/2009 7443038 6.3

26/08/2009 6893038 5.9

11/09/2009 5861376 4.99

Ashmore Group Plc ASHM
14/01/2009 43710160 6.21

15/09/2009 35252236 5.01

15/10/2009 33062737 4.7

Unchanged Positions:

Ishaan Real Estate ISH 01/07/2008 48532342 23.45

04/09/2008 56632342 27.35

28/04/2009 56632342 39.08

Lone Pine’s percentage position in Ishaan increased in April 09 due to a share buy-back program undertaken by company (not from an additional share purchase).

That ends our update of Lone Pine’s UK positions. As always, we will be continuing our tracking series where we look at the positions that prominent hedge fund managers hold in UK markets. If you've missed some of our previous posts covering UK markets, make sure you check out the holdings of Harbinger Capital Partners, Ken Griffin’s Citadel , Louis Bacon's Moore Capital Management and Paul Tudor Jones’s Tudor Investment Corp .

If you're unfamiliar with our new series tracking UK positions, check out
our preface here. We have also covered the potential for hedge fund activism in the UK investment trust sector. In addition, we have reported on London based hedge fund managers GLC Ltd and Lansdowne Partners.

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