nwoodman

Fair point. They seem to be growing into these acquisitions nicely, 1.4b for Zenith and now 1.9 for Brit ;D So much happier to see them picking up quality and market position. Seems like they are a learning organisation after all and near death experiences of years gone by have shaped them (touch wood). cheers nwoodman

What are the chances we look back in a few years and say it was a mute point how they financed it. I think they have just pulled another Zenith. This is a nice set of results! http://www.reuters.com/article/2015/02/25/brit-results-idUSL5N0VZ14620150225 Cheers nwoodman

http://www.fairfax.ca/news/press-releases/press-release-details/2015/Fairfax-to-Acquire-Brit-PLC/default.aspx The Brit Offer Price represents a premium of 11.2% to the closing price of 274.2 pence per Brit Share on February 16, 2015, being the last full business day prior to this announcement. The aggregate purchase price payable by Fairfax for the Offer is approximately US$1.88 billion. On February 12, 2015, Fairfax announced 2014 earnings of approximately US$1.6 billion. Excluding the final dividend expected to be declared by the board of directors of Brit for the year ended December 31, 2014 in an amount of 25 pence per Brit Share , Fairfax's purchase price of 280 pence per Brit Share is less than ten times the company's earnings based on the company's annualized net earnings for the six months ended June 30, 2014. The acquisition is accretive to Fairfax on several metrics including gross revenue per share and investments per share. Fairfax has built a strong relationship with the Brit team and an understanding of their business and operations since the acquisition of Brit's runoff business in June, 2012.

Short article on the pet insurance industry. Nice place for an insurer with a market cap of $10b to play in and hopefully way too small for that "other" company with a slightly larger market cap of $350b http://www.bloomberg.com/news/2014-11-13/dogs-loved-like-children-fuel-pet-insurance-sales.html "Makara is among so-called pet parents fueling a $600 million industry in North America that’s growing at triple the pace of U.S. accident-and-health coverage, drawing investment from companies including Toronto-based Fairfax Financial Holdings Ltd. (FFH) and Nationwide Mutual Insurance Co. Fairfax, run by value investor Prem Watsa, agreed this year to buy Pethealth Inc., North America’s second-largest pet insurer, for C$100 million ($88 million). The Oakville, Ontario-based firm provides pet pharmaceuticals, microchips for animal identification, and insurance that covers everything from behavioral therapy to a reward for the return of a runaway pet. “It’s a nascent industry and demographically it has legs, especially with the adoption of pets as family members,” Fairfax President Paul Rivett said in a telephone interview."

congratulations and keep up the great work Cheers nwoodman

A very tidy quarter. Well done to to all at FFH and so good to see the plan paying off At 1.1x's book with downside protection this is looking cheap again Cheers Nwoodman

Wonderful news. Congrats to all :) Cheers nwoodman

Thanks Gio, looks like regression to the mean might have started on the Russell 2000. I reckon we might get to see some traction on the short side of our favorite long/short "fund" FFH cheers nwoodman

Thanks for this, I really enjoyed it. I haven't had the privilege of hearing John Lace speak before but it has only reinforced my faith in HWIC, grey hairs and a deep understanding of margin of safety is exactly what I am looking for in my largest position. I think he also provides a little more color at the end about the hedges. It has probably been posted already but this is the doco on John Templeton that John Lace mentions http://www.bloomberg.com/video/contrarian-a-documentary-about-john-templeton-aD8U03jnSs2BFr4IuxF~IQ.html thanks again! nwoodman

Results are heading in the right direction http://www.independent.ie/business/bank-of-ireland-ceo-richie-boucher-taxpayer-support-for-the-bank-has-been-rewarded-and-repaid-as-losses-fall-30057063.html Cheers nwoodman

I believe they hold 2,807,463,858 shares and purchased them for 0.1 Euro's each http://www.bankofireland.com/fs/doc/publications/market-news-and-analysis/tr1-notification-fairfax-12-12-13.pdf http://www.lse.co.uk/SharePrice.asp?shareprice=BKIR&share=bank_ireland I would advise steering clear of the LSE chat group as there is a lot of day trading whackiness and aspirational pricing going on ;) Cheers nwoodman

Great article and really enforces the fact that Heins was way out of his league. The fact that Prem backed Heins in the first place is still a mystery to me. The little I have read about Chen certainly gives me hope and hasn't left me squirming the way Heins used to http://thenextweb.com/insider/2013/11/04/5-funniest-things-ex-blackberry-ceo-thorsten-heins-said/ The older I get the more I have come to realise the importance of good management in the overall puzzle. Hopefully Prem's quote comes true and Chen's reputation only grows

Gio so glad it worked out and thanks for sharing. I thought about this thread a few times today and it made me smile. It is an amazing community and culture that Parsad has fostered cheers nwoodman

I am sure you will shoot the lights out just by being your usual enthusiastic, intelligent, thoughtful self. I hope it goes well and enjoy every moment. cheers nwoodman

I am looking forward to to this http://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/exclusive-watch-billionaire-steven-cohen-stumble-over-insider-trading-rules/ Coming this winter, FRONTLINE correspondent Martin Smith (The Untouchables, The Retirement Gamble, Money, Power and Wall Street) and producer Nick Verbitsky examine how prosecutors have set their sights on the hedge fund industry. In the process, they’ve dug into the operations and mind-set of billionaire hedge fund manager Steven A. Cohen. FRONTLINE has exclusively obtained a video deposition in which Cohen, who is rarely seen on camera, addresses these issues. He describes federal insider trading laws as "vague," his firm's own trading rules as "general guidelines" and says he gives his traders latitude to use their judgment while making deals.

That made my day, thanks for posting ;D Hopefully it sets a healthy precedent for any further action by Fairfax

Very helpful, many thanks nwoodman

I wasn't sure where to put this one as it is relevant to a lot of the threads currently under way ;D http://arstechnica.com/tech-policy/2013/10/patent-war-goes-nuclear-microsoft-app Canada-based telecom Nortel went bankrupt in 2009 and sold its biggest asset—a portfolio of more than 6,000 patents covering 4G wireless innovations and a range of technologies—at an auction in 2011. Google bid for the patents, but it didn't get them. Instead, the patents went to a group of competitors—Microsoft, Apple, RIM, Ericsson, and Sony—operating under the name "Rockstar Bidco." The companies together bid the shocking sum of $4.5 billion. Patent insiders knew that the Nortel portfolio was the patent equivalent of a nuclear stockpile: dangerous in the wrong hands, and a bit scary even if held by a "responsible" party. This afternoon, that stockpile was finally used for what pretty much everyone suspected it would be used for—launching an all-out patent attack on Google and Android. The smartphone patent wars have been underway for a few years now, and the eight lawsuits filed in federal court today by Rockstar Consortium mean that the conflict just hit DEFCON 1.

The QNA and only the QNA :) cheers nwoodman rec_+18008795206_02_Nov_2013_02_41_34.mp3

Thanks Gio, the models are appreciated. Not surprisingly they mirror my view of investing and results. Periods of not much, followed by FX hits (in my case) and capital declines, followed by feelings of I'm a genius, followed by oh $#$%. However over time, the NAV moves forward at an acceptable rate. The constant reminder is never play this game with leverage. I take my hat off to the Erics and Parsad's of the worlds that can make money from that kind of (time based) strategy. However, I am just a simple engineer (like you I believe) and margin of safety (value and time) must always apply. We must also be careful in this endeavor as group think is the biggest challenge we face :)

"Alot of people here make too many excuses for FFH". Hey Uccmal, I always appreciate your thoughts (along with everyone else who contributes) and you may well be right. This quarterly loss certainly caught me off guard, so if you saw it coming then well done. I figured a wash to a small loss for this quarter, so my modelling needs some revising :-[ However even after the biggest quarterly loss I have experienced as an owner, they are still only trading at 1.3 x's book and will probably trade somewhat lower shortly. I have my view that this company is undervalued at 1x's book and fair value at 1.5x's book. How do you value them especially in a hardening market for insurance and where the broader market is stretched?

Currently around 40% of my portfolio, after trimming some BRK and BAC. I will only consider selling FFH if the bid gets to > 1.5x's book (which I hope it doesn't)

2.8 bn (2,807,463,858)

Absolutely, you can back it in. I get the impression that Jain's actions are the passive aggressive version of of NI's sharpening pencils cheers nwoodman

Many thanks. That guys writing style makes my head hurt but some interesting observations nonetheless cheers nwoodman