A billionaire investor dubbed ‘the next Warren Buffett’ just revealed a $400 million bet on Bill Ackman’s SPAC

Seth Klarman

Summary List Placement

Seth Klarman’s Baupost Group is betting that billionaire investor Bill Ackman and “Moneyball” star Billy Beane can make shrewd acquisitions in the coming months.
The billionaire’s hedge fund disclosed in a regulatory filing that it held a $400 million stake in Ackman’s special-purpose acquisition vehicle or “SPAC,” Pershing Square Tontine, at the end of September.
Baupost also revealed a $52 million position in Redball Acquisition Corp., another SPAC that is co-chaired by Beane and reportedly held talks to buy the Boston Red Sox in October.
Klarman has been touted as “the next Warren Buffett” because he also follows a value-investing approach.

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A billionaire investor heralded as “the next Warren Buffett” handed cash to hedge-fund manager Bill Ackman and “Moneyball” star Billy Beane last quarter, backing the pair to strike lucrative deals in the coming months.

Seth Klarman’s Baupost Group revealed in a regulatory filing that as of September 30, it held a roughly $400 million stake in Ackman’s Pershing Square Tontine, a special-purpose acquisition vehicle or “SPAC” that went public in July.

Ackman raised a record $4 billion from the listing to target “mature unicorns”, or buy a minority stake in a company valued between $10 billion and $15 billion.

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Klarman’s hedge fund also disclosed a $52 million stake in RedBall Acquisition Corp., another “blank-check” company that counts Beane as its co-chairman.

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As general manager of the Oakland Athletics, Beane pioneered the use of statistics in baseball to identify and recruit undervalued players. Author Michael Lewis told his story in “Moneyball” and he was portrayed by Brad Pitt in the movie adaptation.

Klarman’s nickname is the “Oracle of Boston”, because he follows Buffett’s signature strategy of investing in undervalued stocks. He may have backed Ackman because the Pershing Square chief also embraces some value-investing principles.

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Meanwhile, RedBall has held talks to buy Red Sox-owner Fenway Sports, The Wall Street Journal reported in October, so Klarman’s Boston pride may be a factor in that investment.

Baupost also revealed a $30 million stake in Broadstone Acquisition Corp., a blank-check company targeting investments in the UK and Europe, suggesting Klarman sees SPACs as valuable additions to his portfolio.

The total value of Baupost’s portfolio rose by about 16% to $9.3 billion last quarter, despite the fund trimming several holdings including Alphabet, Facebook, HP, and eBay.

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Source:: Businessinsider – Finance


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