Lansdowne Partners Disclose Stake in Ocado Group: A Hedge To Their Sector Short? ~ market folly

Thursday, November 29, 2012

Lansdowne Partners Disclose Stake in Ocado Group: A Hedge To Their Sector Short?

Lansdowne Partners has disclosed a new long position in online grocery retailer, Ocado Group  (LON: OCDO).  Due to trading on November 11th, Lansdowne now hold the equivalent of 5.72% of  Ocado's voting rights.  

Lansdowne appear to be going against the crowd with this particular wager. The disclosed short interest in Ocado is high at -  17.29% of the company's float, including some managers with big reputations like Blue Ridge Capital and Kynikos Associates.  Here's a breakdown:

Short Positions in Ocado 

Ardevora Asset Management LLP  -0.33% of shares
BlackRock Investment Management (UK) Limited -2.52%
Blue Ridge Capital L.L.C -2.41%
Dalton Strategic Partnership LLP -1.34%
Ennismore Fund Management Limited -0.99%
GMT Capital Corp -2.52%
Kynikos Associates LP -4.35%
Newedge UK Financial Ltd -0.16%
Newedge UK Financial Ltd on behalf of Newedge Group -0.56%
Oxford Asset Management -0.55%
Parvus Asset Management (UK) LLP -0.89%
S.A.C. Capital Advisors, L.P - -0.67%

Total disclosed shorts  -17.29%

While upon cursory glance this appears to be a contrary bet by Lansdowne, examining their own book reveals that this could merely be a hedge to their other shorts in the sector.

Lansdowne has disclosed short positions in Tesco -0.62% and WM Morrison Supermarkets -2.51%.  The value of these short positions, though, is far higher than the Ocado long. Overall, it seems that  Lansdowne is bearish on the food retail sector.

For more hedge fund activity in the UK and other EU countries check out our new series of posts on short positions.

Per Google Finance - "Ocado Group plc is a United Kingdom-based holding company. The Company  is an online grocery retailer. The principal activity of the Company, along with its subsidiaries, is  retailing and distribution of grocery and consumer goods within the United Kingdom. The Company  owns Ocado Holdings Limited, which holds the entire interest in Ocado Limited. The principal  activity of Ocado Limited includes retailing and distribution of grocery and consumer goods. On  February 9, 2010, the Company acquired Ocado Limited. The Company's wholly owned subsidiaries  include Ocado Holdings Limited, which is an holding company; Ocado Limited, which is engaged  in retail and distribution; Ocado Information Technology Limited, which is engaged in intellectual  property, and Ocado Cell in Atlas Insurance PCC Limited, which is an insurance company. Ocado  Holdings Limited is a 100%-owned subsidiary of Ocado Group plc."

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