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Alex Gabor
Alex Gabor

George Soros Dumps Microsoft Stock and Redeploys into Stock Exchanges

May 17, 2006 | About:

by Alex Gabor

A recent U.S. Securities & Exchange Commission filing from Soros Fund Management, billionaire financier George Soros' investment fund--which has investments in 286 companies and has a total fair market value of $2.72 billion shows some significant changes to the fund, which still holds large stakes in Sun Microsystems (SUNW), JetBlue Airways (JBLU), Hainan Airlines, Skyworks Solutions (SWKS), Lattice Semiconductor and EchoStar Communications (DISH)among others.

Hi9s indirect stake in the gargantuan software company Microsoft (MSFT) has been cut to 251,750 shares from from 1.38 million during the past quarter. The sale of over 1.1 million shares gave Soros Fund Managers at least $30 million in cash to redeploy into other investments more promising than Microsoft. The sale may have been a small factor in the recent plunge of microsoft shares from a 52 week high of around 28 to closer to $22 in recent trading days.

The SEC filing further discloses that Soros has acquired 857,400-shares of Boston Scientific--which recently completed its acquisition of Guidant--and a 698,500-share stake in communications equipment maker Cisco Systems.

The Hungarian-born and London School of Economics-educated Soros is betting on the rumblings of global exhanges recent merger talks. Soros, who is the world's 71st richest man according to Forbes magazine, doubled his fund's stake in the Nasdaq Stock Market (nasdaq: NDAQ ) to 553,200 common shares and took on an 89,750-share stake in NYSE Group (nyse: NYX ).

NASDAQ recently received approval from the Securities and Exchange Commission (SEC) to begin operations as a national securities exchange.

Exchanges continue to be under tremendous pressure to consolidate to boost volumes, create economies of scale that reduce trading costs and to attract more companies to list their shares.

Talks between NYSE Group and European share markets operator Euronext and the German Bourse have been ongoing for the past few days signaling that a possible merger may be in the wings. NYSE Group, Inc. last week filed an 8-K announcing the combination of the businesses of the New York Stock Exchange, Inc. and Archipelago Holdings, Inc., making it the largest and most technologically sophisticated stock exchange in the world.

At the same time, developments in Iran for the establishment of the Iranian Oil Bourse have speculators lining up in Europe on the side of the Euro as investors like Soros, Gates and Buffet continue to hold huge multi billion dollar short positions on the U.S. dollar as inflation rears its ugly head in the United States and Central Bankers are focusing on pulling away from trading oil contracts in dollars if the IOB begins operations any time soon.

The dollar has slid more than 6% in the past month alone and as interest rates are raised to stem the loss in purchasing power, U.S. consumer confidence continues to slide, wholesale prices have begun to reflect what savy investors have been predicting for the past two years, and the U.S. and British real estate markets have seen notices of default increase by more than 50% during the first quarter of 2006.

Rating: 3.0/5 (6 votes)


AlexGabor - 14 years ago    Report SPAM
The New York Stock Exchange, seeking to beat rival Nasdaq Stock Market Inc. in the race to become the first trans-Atlantic stock market, offered $10.2 billion in cash and shares Monday for European exchange operator Euronext NV.
AlexGabor - 14 years ago    Report SPAM
Hainan Airlines, a Chinese carrier whose biggest shareholder is U.S. financier George Soros, may raise as much as 8.7 billion yuan, or $1.1 billion, by selling additional shares to fund plane purchases
AlexGabor - 14 years ago    Report SPAM
Soros Fund Management LLC said on Tuesday it now owns 6.8 percent of NPS Pharmaceuticals Inc. (NPSP) according to a filing with the U.S. Securities and Exchange Commission.

The fund, controlled by billionaire investor George Soros, acquired more than 3.1 million shares over the past 60 days for a total of about $8.9 million, according the filing.

The Soros group is "concerned about...the past and current decision making and operations," of the company and "may suggest strategic changes," the filing said.

NPS' stock is trading at $5.93 a share in after hours trading after closing at $5.44 on the Nasdaq.

AlexGabor - 14 years ago    Report SPAM
"In some cases, such as Soros Fund Management, the hedge fund is really just running one family's money," Mr. Peltz said.

George Soros, who made his name as a currency trader, is estimated to have made $840-million last year.
AlexGabor - 14 years ago    Report SPAM
Top 10 hedge fund earners based on 2005 annual compensation.

1. James Simons

$1.5-billion (U.S.)

Renaissance Technologies

2. T. Boone Pickens


BP Capital Management

3. George Soros


Soros Fund Management

4. Steven Cohen


SAC Capital Advisors

5. Paul Tudor Jones


Tudor Investment

6. Edward Lampert


ESL Investments

7. Bruce Kovner


Caxton Associates

8. David Tepper


Appaloosa Management

9. David Shaw


D.E. Shaw

10. Stephen Mandel


Lone Pine Capital

AlexGabor - 14 years ago    Report SPAM
George Soros, the Hungarian born financial speculator, stock investor, is scheduled to visit Turkey at the beginning of June to review investment opportunities in Turkey.

Quantum Fund, the flagship of Soros Fund Management makes investments in the food and financial sectors in Turkey.
AlexGabor - 14 years ago    Report SPAM
Soros Shifting Sales of Stocks to Safer Sentinals.

By Alex S. Gabor

Nothing has gone smoothly in the $1.2 trillion hedge fund industry since a sell-off which began in early May on precious metals prices spilled into emerging markets and soon affected developed markets.

In the absence of a real catalyst, analysts blame fears of inflation and rising rates for the sudden drop.

Many of the world's roughly 8,000 funds lost between 3 and 6 percent in the first three weeks of May with some having seen swings of 10 percent or more, investors and researchers said.

The current troubles even remind some people of the early days of 2000 when legendary investor George Soros restructured his empire after heavy losses on technology stocks, however Soros has been redeploying his funds around the world amid shifting commodity prices and his prediction of a total collapse of the US Real Estate Market beginning in 2007.

On May 19, 2006 Grupo Famsa completed a US$260mn initial public offering on the Mexican stock exchange. The group and selling shareholders, Monterrey Venture Holding LLC (a GE pension trust) and Tapazeca SL (a George Soros fund) sold approximately 30% of the company's stock at 26 pesos (US$2.36) per share.

In 1999, Tapazeca and Monterrey Venture Holding bought 13.8% of Famsa and the fresh capital enabled the company to increase the number of stores to 314 at end-2005 from 180 stores in 1999.

Monterrey-based retailer Famsa was created in 1970 and is controlled by the Mexican Garza family. It has 299 stores in Mexico and 15 in the US and reported sales of 10.6bn pesos (US$954mn) last year.

Soros had committed to stay on board for 5 years, utilizing the IPO as a successful exit strategy.

Another current investment of Soros in the Mexican economy involves Comunicaciones Nextel de México, SA of CV (Nextel). Nextel is a Mexican company that is dedicated to providing services of specialized movable radio communication of flotillas in diverse cities in the Mexican Republic.

Tapazeca was represented to the Mexican government as an investment society of Spanish nationality (domiciled in Spain) that is dedicated to financial investment and is filial of the denominated investment fund Mexico Strategic Investment Fund, Ltd., another Soros investment vehicle, managed by Soros Fund Management out of New York.

Soros Fund filed documents with the Mexican government after it notified it about a transaction which consisted of the acquisition on the part of Tapazeca of a minority participation of the share capital of Nextel. The total amount invested was not disclosed in the documents. The Nextel of Mexico is affiliated with Nextel in the US.

AlexGabor - 14 years ago    Report SPAM
On May 24th, 2006, Eircom Group Plc agreed to accept a takeover offer valued at 2.36bn euro ($2.89bn) from the Australian investment fund Babcock & Brown Capital Ltd.

Under the terms of the deal, BCM Ireland Holdings Ltd (BCMIH), a group comprising of Babcock & Brown and the Eircom Employee Share Ownership Trust (ESOT), will offer 2.20 euros ($2.82) in cash for each Eircom share, plus a second interim dividend of 0.052 euros ($0.06).

This values the deal at 2.42bn euros ($3.11bn) and is a 4.3% premium on the share price before Babcock & Brown made its preliminary approach in February this year. The deal also gives Eircom an enterprise value of about 4.8bn euros ($6.15bn).

Eircom is Ireland's dominant fixed-line operator with a market share of roughly 79%. Like BT Group Plc in the UK, it fell prey to the prevailing financial wisdom of the time that fixed-line operators should spin out their mobile operations in order to concentrate on core business and allow for flexible growth opportunities for the mobile unit with no shackles to legacy communications. Consequently in 2001 Eircom sold its Eircell mobile operation to mobile giant Vodafone Group Plc for 4.3bn euros ($5.19bn).

But the sale of its mobile arm triggered a VC takeover battle. The carrier was taken private in a 3bn euro ($3.72bn) deal by the Valentia consortium, whose stakeholders included Irish magnate Sir Anthony O'Reilly, financier George Soros, and Providence Equity Partners. The carrier returned to the stock market in March 2004 through another IPO on the London Stock Exchange.

AlexGabor - 14 years ago    Report SPAM
HAINAN Airlines Co, China's fourth-biggest carrier, is planning to set up a regional airline in Tianjin to tap demand in the country's north.

The new carrier, Grand Air Express, is part of Hainan's plan to build a regional hub in Tianjin, company officials said.

Hainan Airlines, which is 14.8 percent owned by US financier George Soros, and its parent, HNA Group, will invest a total 100 million yuan (US$12.5 million) in the new carrier, to be based at Tianjin Binhai Airport, the company said in its application to the industry regulator.

HNA Group will pay 80 million yuan in cash for a 80 percent stake in the new carrier, and Hainan Airlines will pay 20 million yuan for the remainder.

The carrier will conduct regional passenger and freight services, renting at least five 32-seat Dornier 328 aircraft from Hainan Airlines during its initial operations.

Grand Air intends to put 50 to 100 planes into the skies in three to five years to become China's biggest regional carrier.

HNA Group is planning to combine Hainan Airlines with others such as Xinhua Airlines, Changan Airlines and Shanxi Airlines to form Grand China Air, which will focus on trunk routes.
AlexGabor - 14 years ago    Report SPAM
NPS Pharmaceuticals Inc. (Nasdaq: NPSP) 6.2% HIGHER; Reports Soros Fund Management LLC now owns 6.8% of NPSP.
AlexGabor - 14 years ago    Report SPAM
Bluefly, Inc. (BFLY) said private funds associated with Maverick Capital, Ltd. and an entity affiliated with Prentice Capital Management, LP reached a definitive agreement to purchase $50 million of newly issued common stock from the company.

In connection with the transaction, private funds associated with Soros Fund Management LLC, collectively Bluefly's largest stockholder, agreed to convert all of their preferred stock into common stock. $25 million of the proceeds will be retained by Bluefly to grow its business and fund working capital. The balance of $25 million will be used to repay debt to the Soros funds, as well as to pay accrued dividends on the preferred stock being converted in connection with the transaction.

AlexGabor - 14 years ago    Report SPAM
After the deal, the Soros funds will own 39 percent of Bluefly's outstanding shares.
AlexGabor - 14 years ago    Report SPAM
"Clearly there is a making of a slow down due to the softness of the housing market, but it has not yet had its effect. In the meantime, we have cost inflation pressures so you are caught in a double whammy, that the economy is slowing down or expected to slow down but you still have to fight inflation." George Soros


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