Pennant Capital Reduces Homeserve Position ~ market folly

Tuesday, June 5, 2012

Pennant Capital Reduces Homeserve Position

Alan Fournier's hedge fund firm Pennant Capital has reduced its position in UK traded Homeserve (LON:HSV).  Due to trading on May 22nd, the hedge fund has reduced their position under the 3% disclosure threshold.

Shares of Homeserve fell 29% on May 22nd after the company announced that it was downsizing its operation in the UK in response to a formal investigation by the Financial Services Authority.  On May 19th, the company received a  £750,000 fine over its cold calling practices, the largest fine ever handed out by Ofcom.

While the official notification says that Pennant now hold 2.96% of the voting rights, there's no way to know of further sales as they aren't required to disclose them after falling below that level.

We originally posted about Pennant's new position in Homeserve back on March 6th.  Hedge fund Marathon Asset Management was another previously sizable holder of shares as they reported a 5.24% stake back in November 2011.

Per Google Finance - "Homeserve plc provides home emergency and repair services to over 4.9 million customers across the United Kingdom, the Unites States of America, France and Spain. Services are provided through its membership businesses, which are responsible for the marketing and administration of over 11 million home repair and appliance warranty policies. The Company operates in five segments: UK, USA, Domeo, Spain and New Markets. "

In other activity from Fournier's fund, we've highlighted how they've been buying Huntington Ingalls Industries.

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