Loeb really hates Watsa but invests in Blackberry


We recently mentioned Third Point LLC’s 13F and one of the interesting moves was Daniel Loeb and Third Point LLC’s dive into Blackberry (BBRY) for 10 million shares. Besides being a hotly contested stock with an interesting ride from the top of mountain pre-iPhone to one of the strangest leveraged buyout offers led by Fairfax Financial’s (FFH) Prem Wasta. There’s a few more elements of interest there.

Daniel Loeb really doesn’t like Prem Wasta

Prem Wasta is the founder, chairman, and chief executive of Fairfax Financial Holdings (FFH.CA), based in Toronto, Canada and a board member and the largest shareholder of Blackberry. Loeb, Third Point LLC and other hedge funds were heavily short Fairfax Financial for years and Wasta fired back with lawsuits. Loeb and Third Point were dismissed of any wrong doing but some very interesting emails emerged from the situation.

Both examples from Reuters.

May 2003

In May 2003, Loeb compared Fairfax to “Hitler himself” when expressing displeasure to another trader about a rebound in the insurer’s share price. Fairfax’s lawyer’s said Loeb, in the instant message exchange, was upset that the rise in the company’s shares was making it more costly for him to maintain his short position, which required him to borrow more stock from a broker.

Summer of 2006

“Prem Watsa bend over the hedge funds have something special for you,” Loeb wrote in the June 25, 2006 email to Adam Sender, the founder of Exis Capital, whose hedge fund also was “shorting” Fairfax — that is, looking to profit from a decline in its shares. A little later that day, in an email to a consultant who was doing research for some of the hedge funds wagering on Fairfax’s fall, Loeb wrote: “die, Prem Die!”

Third Point invests in Blackberry

While the position of $74.4 million represents a relatively small position for Third Point LLC whom manages over $1.7 billion (October 31st, 2013), it does represent a near 2% position in Blackberry, a corporation where Daniel Loeb has expressed extreme hatred for its major shareholders and that makes it interesting.

InvestCorrectly Staff
InvestCorrectly Staff

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