SafetyinNumbers Posted April 8 Posted April 8 2 hours ago, TwoCitiesCapital said: I would've preferred the straight copper exposure, but I suppose there are worse outcomes than diversifying with gold. Also, probably puts a higher floor under the share price if we get an economic slowdown here in the mid-term, so maybe not all bad. Diversified by project, more liquid and cheaper are pretty good attributes too. Will be interesting if they hold on.
Viking Posted April 8 Posted April 8 (edited) 3 hours ago, TwoCitiesCapital said: I would've preferred the straight copper exposure, but I suppose there are worse outcomes than diversifying with gold. Also, probably puts a higher floor under the share price if we get an economic slowdown here in the mid-term, so maybe not all bad. This deal largely flips Fairfax’s exposure in Foran from copper to gold (El Dorado is 85% gold and 15% copper). Fairfax obviously was happy with the transaction. This deal meaningfully increases Fairfax’s exposure to gold. Orla is their 4th largest equity holding $1.3B). They will soon add El Dorado ($500M). This would put Fairfax’s exposure to gold at about $1.8B, or 6.3% of the total equity portfolio. As @SafetyinNumbers mentioned, El Dorado will provide much better liquidity (likely making it easier for Fairfax to exit the investment in the future). Edited April 8 by Viking
Hoodlum Posted April 8 Posted April 8 Eurobank received a ratings upgrade today. We will likely see similar upgrades from other rating agencies over the next few months. https://dbrs.morningstar.com/research/478320
Viking Posted April 14 Posted April 14 (edited) How are Fairfax's equity holdings performing QTD-Q2 2026 (two weeks in to April 14)? The holdings I track are up about $1.4B or $63/share. Yes, it is only 2 weeks into the quarter. And lots will change in the coming weeks and months. Regardless, that is a significant increase. The driver, not surprisingly, is Eurobank. But lots of holdings are up nicely. The holdings that are down are, not surprisingly, the oil holdings. These holdings are down modestly after posting big gains in Q1. Edited April 14 by Viking
Haryana Posted April 15 Posted April 15 On 4/7/2026 at 8:39 PM, Viking said: This deal largely flips Fairfax’s exposure in Foran from copper to gold (El Dorado is 85% gold and 15% copper). Fairfax obviously was happy with the transaction. This deal meaningfully increases Fairfax’s exposure to gold. Orla is their 4th largest equity holding $1.3B). They will soon add El Dorado ($500M). This would put Fairfax’s exposure to gold at about $1.8B, or 6.3% of the total equity portfolio. As @SafetyinNumbers mentioned, El Dorado will provide much better liquidity (likely making it easier for Fairfax to exit the investment in the future). Eldorado Gold Completes Acquisition of Foran Mining https://www.globenewswire.com/news-release/2026/04/14/3273325/0/en/Eldorado-Gold-Completes-Acquisition-of-Foran-Mining.html Also, having now used Foran to jump on to a much bigger entity would allow them to increase their exposure to gold even higher if required with funding and acquisitions.
Hoodlum Posted April 17 Posted April 17 On 4/14/2026 at 5:31 PM, Viking said: How are Fairfax's equity holdings performing QTD-Q2 2026 (two weeks in to April 14)? The holdings I track are up about $1.4B or $63/share. Yes, it is only 2 weeks into the quarter. And lots will change in the coming weeks and months. Regardless, that is a significant increase. The driver, not surprisingly, is Eurobank. But lots of holdings are up nicely. The holdings that are down are, not surprisingly, the oil holdings. These holdings are down modestly after posting big gains in Q1. Blackberry shares are also up 45% ($37M) this month, assuming Fairfax hasn’t sold any shares.
Viking Posted April 19 Posted April 19 (edited) Foran – Using the Venture Capital Playbook in Mining Hat tip to @SafetyinNumbers for the VC / Lassonde Curve insights... Introduction Eldorado Gold completed its acquisition of Foran Mining on April 14, 2026. For Fairfax, this transaction marks the successful monetization of a high-conviction, multi-year investment. The headline return is compelling. But the more instructive story lies in how that return was generated. To understand what happened, it helps to view the investment through two lenses: Venture capital The Lassonde Curve Part I — The Outcome Fairfax initiated its investment in Foran in August 2021 added to the position five additional times, deploying a total of$234 million. At closing (April 14, 2026): Market value: ~$504 million Total gain: ~$270 million Return: ~115% Timeframe: ~3 years (weighted average) This is an exceptional outcome—particularly for a capital-intensive, early-stage mining asset. But focusing solely on the return obscures the more important point: the process that produced it. Part II — Framing the Investment This was not a conventional public equity investment. Foran had two defining characteristics: A venture-like profile (early-stage, capital-intensive, uncertain) Commodity exposure (inherently cyclical) Equally important was Fairfax’s partnership with Pierre Lassonde—the central figure behind the Lassonde Curve and a long-time architect of value creation in the mining industry. Part III — The Lassonde Curve as a Roadmap The Lassonde Curve describes how value typically evolves across a mining project’s lifecycle: Discovery → excitement and rising valuations Feasibility → reality sets in; valuations compress Development → capital intensity peaks; valuations trough Production → cash flow emerges; valuations re-rate The key insight: The most attractive risk-adjusted opportunities often appear in the middle—when uncertainty is highest and investor interest is lowest. This framework provides a roadmap for capital allocation. Understanding the Mining Life Cycle - the Lassonde Curve https://smallcapinvestor.ca/the-lassonde-curve-understanding-the-mining-life-cycle/ Part IV — Entry: The “Orphan Period” Fairfax began building its position in 2021, during the feasibility/development phase: The asset was proven but not yet built Capital requirements were significant Market sentiment was weak This is the “orphan period”: Maximum uncertainty Maximum capital intensity Minimal investor sponsorship Fairfax leaned into this dislocation with a venture-style approach: Built a 22.6% ownership stake (121.9 million shares) Funded the project across multiple rounds Accepted illiquidity and volatility Part V — Acting Like a Venture Capitalist Fairfax’s behavior closely resembled that of a lead venture investor: Provided growth capital through critical stages Absorbed development risk others avoided Positioned for a discrete value inflection In mining, value creation is rarely linear. The Lassonde Curve makes this explicit: a large portion of value is realized late in the development cycle—and often abruptly. Part VI — Exit: Capturing the Re-Rating The acquisition by Eldorado represents a classic inflection point: Major development risks were removed The asset became attractive to a strategic buyer Market value began to reflect underlying economics Rather than waiting for full production, Fairfax exited at the re-rating phase—a textbook outcome. Result: ~$234M invested ~$504M realized ~115% return This aligns precisely with the Lassonde framework: a meaningful share of value is realized before production, once key uncertainties are resolved. Part VII — Rolling Forward: From Asset to Platform The transaction structure is equally important. By received shares in Eldorado: Gains were effectively crystallized (tax-efficiently) Liquidity improved materially Risk profile declined Optionality increased This mirrors a venture investor exiting into a strategic acquirer: From concentrated, high-risk exposure To ownership in a diversified, cash-flowing platform The Bigger Picture Foran is not an isolated case. It fits a broader pattern of successful commodity monetization by Fairfax in recent years: Resolute Forest Products (2022) – Sold at a premium valuation at peak of lumber cycle. Stelco (2024) – Sold at a premium valuation during strong M&A market in NA steel. Orla Mining (partial, 2025) – 25% stake sold at a +250% gain. Foran Mining (2026) – acquired by Eldorado Gold Bottom Line Viewed through the Lassonde Curve, this was a highly disciplined capital allocation exercise: Entered during peak pessimism Funded through the most capital-intensive phase Exited at the point of value recognition The involvement of Pierre Lassonde is not incidental—it reinforces how closely the investment followed the framework he helped formalize. This was not a passive investment in a mining company. It was: A venture-style deployment of capital Executed alongside experienced operators Guided by a clear roadmap of value creation Carried through with patience and discipline Foran is another data point supporting a couple of broader conclusions: Within its investment management business, Fairfax has quietly built another differentiated capability—operating at the intersection of venture capital, commodities, and long-term capital allocation. More broadly, when it comes to capital allocation, Fairfax has been executing exceptionally well for more than 5 years now. Foran is just the latest example. Edited April 20 by Viking
SafetyinNumbers Posted April 19 Posted April 19 4 hours ago, Viking said: Foran – Using the Venture Capital Playbook in Mining Hat tip to @SafetyinNumbers for the VC / Lassonde Curve insights... Introduction Eldorado Gold completed its acquisition of Foran Mining on April 14, 2026. For Fairfax, this transaction marks the successful monetization of a high-conviction, multi-year investment. The headline return is compelling. But the more instructive story lies in how that return was generated. To understand what happened, it helps to view the investment through two lenses: Venture capital The Lassonde Curve Part I — The Outcome Fairfax initiated its investment in Foran in August 2021 added to the position five additional times, deploying a total of$234 million. At closing (April 14, 2026): Market value: ~$504 million Total gain: ~$270 million Return: ~115% Timeframe: ~3 years (weighted average) This is an exceptional outcome—particularly for a capital-intensive, early-stage mining asset. But focusing solely on the return obscures the more important point: the process that produced it. Part II — Framing the Investment This was not a conventional public equity investment. Foran had two defining characteristics: A venture-like profile (early-stage, capital-intensive, uncertain) Commodity exposure (inherently cyclical) Equally important was Fairfax’s partnership with Pierre Lassonde—the central figure behind the Lassonde Curve and a long-time architect of value creation in the mining industry. Part III — The Lassonde Curve as a Roadmap The Lassonde Curve describes how value typically evolves across a mining project’s lifecycle: Discovery → excitement and rising valuations Feasibility → reality sets in; valuations compress Development → capital intensity peaks; valuations trough Production → cash flow emerges; valuations re-rate The key insight: The most attractive risk-adjusted opportunities often appear in the middle—when uncertainty is highest and investor interest is lowest. This framework provides a roadmap for capital allocation. Understanding the Mining Life Cycle - the Lassonde Curve https://smallcapinvestor.ca/the-lassonde-curve-understanding-the-mining-life-cycle/ Part IV — Entry: The “Orphan Period” Fairfax began building its position in 2021, during the feasibility/development phase: The asset was proven but not yet built Capital requirements were significant Market sentiment was weak This is the “orphan period”: Maximum uncertainty Maximum capital intensity Minimal investor sponsorship Fairfax leaned into this dislocation with a venture-style approach: Built a 22.6% ownership stake (121.9 million shares) Funded the project across multiple rounds Accepted illiquidity and volatility Part V — Acting Like a Venture Capitalist Fairfax’s behavior closely resembled that of a lead venture investor: Provided growth capital through critical stages Absorbed development risk others avoided Positioned for a discrete value inflection In mining, value creation is rarely linear. The Lassonde Curve makes this explicit: a large portion of value is realized late in the development cycle—and often abruptly. Part VI — Exit: Capturing the Re-Rating The acquisition by Eldorado represents a classic inflection point: Major development risks were removed The asset became attractive to a strategic buyer Market value began to reflect underlying economics Rather than waiting for full production, Fairfax exited at the re-rating phase—a textbook outcome. Result: ~$234M invested ~$504M realized ~115% return This aligns precisely with the Lassonde framework: a meaningful share of value is realized before production, once key uncertainties are resolved. Part VII — Rolling Forward: From Asset to Platform The transaction structure is equally important. By received shares in Eldorado: Gains were effectively crystallized (tax-efficiently) Liquidity improved materially Risk profile declined Optionality increased This mirrors a venture investor exiting into a strategic acquirer: From concentrated, high-risk exposure To ownership in a diversified, cash-flowing platform The Bigger Picture Foran is not an isolated case. It fits a broader pattern of successful commodity monetization by Fairfax in recent years: Resolute Forest Products (2022) – Sold at a premium valuation at peak of lumber cycle. Stelco (2024) – Sold at a premium valuation during strong M&A market in NA steel. Orla Mining (partial, 2025) – 25% stake sold at a +250% gain. Foran Mining (2026) – acquired by Eldorado Gold Bottom Line Viewed through the Lassonde Curve, this was a highly disciplined capital allocation exercise: Entered during peak pessimism Funded through the most capital-intensive phase Exited at the point of value recognition The involvement of Pierre Lassonde is not incidental—it reinforces how closely the investment followed the framework he helped formalize. This was not a passive investment in a mining company. It was: A venture-style deployment of capital Executed alongside experienced operators Guided by a clear roadmap of value creation Carried through with patience and discipline Foran is another data point supporting a broader conclusion: Within its investment management business, Fairfax has quietly built another differentiated capability—operating at the intersection of venture capital, commodities, and long-term capital allocation. I appreciate these look backs on individual investments that you do @Viking. The stock is arguably pricing in <5% returns on the equity portfolio which is low vs recent history and inconsistent with fair value vs carrying value.
Viking Posted April 20 Posted April 20 16 hours ago, SafetyinNumbers said: I appreciate these look backs on individual investments that you do @Viking. The stock is arguably pricing in <5% returns on the equity portfolio which is low vs recent history and inconsistent with fair value vs carrying value. When it comes to capital allocation, Fairfax has been putting on a clinic over the past 5 years. The interesting thing is the stock is cheap. So investors are getting best-in-class capital allocation for free. For investors, that is like shooting fish in a barrel.
SafetyinNumbers Posted April 20 Posted April 20 (edited) 3 hours ago, MungerWunger said: Anyone know why blackberry stock has gone parabolic? Estimates ticking up plus short covering is my guess. Edited April 20 by SafetyinNumbers
Hoodlum Posted April 20 Posted April 20 1 hour ago, SafetyinNumbers said: Estimates ticking up plus short covering is my guess. BB also announced today an expanded partnership with Nvidia.
Hoodlum Posted April 21 Posted April 21 It will be interesting to see how many BB shares were sold by Fairfax. Volume has been very high the past few days with 65M shares traded yesterday.
Viking Posted April 21 Posted April 21 (edited) 54 minutes ago, Hoodlum said: It will be interesting to see how many BB shares were sold by Fairfax. Volume has been very high the past few days with 65M shares traded yesterday. @Hoodlum, this makes sense. Fairfax has been slowly selling down their Blackberry position. Perhaps they took advantage of the recent spike in the share price to exit the position. This would do a couple of things: Free up some capital that can be reinvested into other above average opportunities that fit Psychological: exit a long term mistake (Was Blackberry their worst long term investment?) At the end of the day, I don't have an opinion on what I think Fairfax should do. BB is a small investment today. I trust Fairfax will make a good decision (keep or continue to sell). But it is interesting to speculate - BB continues to provide lots of entertainment value. Edited April 21 by Viking
Hoodlum Posted April 21 Posted April 21 26 minutes ago, Viking said: @Hoodlum, this makes sense. Fairfax has been slowly selling down their Blackberry position. Perhaps they took advantage of the recent spike in the share price to exit the position. This would do a couple of things: Free up some capital that can be reinvested into other above average opportunities that fit Psychological: exit a long term mistake (Was Blackberry their worst long term investment?) At the end of the day, I don't have an opinion on what I think Fairfax should do. BB is a small investment today. I trust Fairfax will make a good decision (keep or continue to sell). But it is interesting to speculate - BB continues to provide lots of entertainment value. Fairfax may have their own internal celebration once they are completely exited from BlackBerry. Prem would certainly highlight it on a conference call.
ourkid8 Posted April 21 Posted April 21 5 hours ago, Viking said: (Was Blackberry their worst long term investment?) To me, BB was no mistake at all — it was a gift that kept on giving. The prolonged suppression in the share price gave patient long-term holders (like Fairfax and ourselves) the ability to keep accumulating significant positions at very attractive average costs over many years. That low valuation and volatility created the opportunity to build a truly meaningful stake without moving the market against us.
LC Posted April 22 Posted April 22 Sometimes it's good to see the dog in your portfolio. I'm sure staring at that position helped inspire them to avoid repeating similar mistakes.
Hoodlum Posted April 22 Posted April 22 Eurobank debt rating outlook was downgraded to negative by Moody's due to creditor Hierarchy changes by the EU. https://www.tovima.com/finance/moodys-adjusts-greek-bank-outlooks/ The move follows the approval in March 2026 of the Crisis Management and Deposit Insurance (CMDI) legislative package by European lawmakers. The reform significantly reshapes creditor hierarchy in cases of bank resolution or insolvency, placing depositors ahead of holders of senior unsecured debt—thereby strengthening depositor protection across the bloc. • Long-term deposit ratings: Piraeus Bank was upgraded by one notch with a stable outlook. Eurobank, National Bank of Greece, and Alpha Bank were affirmed with stable outlooks, while Optima Bank’s outlook was revised to positive from stable. • Issuer and senior unsecured debt ratings (where applicable): Piraeus Bank, Alpha Bank, and Optima Bank were affirmed with stable outlooks. Eurobank and National Bank of Greece were also affirmed, but their outlooks were revised to negative from stable. Its updated analysis assumes a unified EU-wide creditor hierarchy, boosting deposit protection but pressuring senior debt and issuer outlooks due to thinner buffers. Negative outlooks highlight uncertainty over banks’ ability to rebuild these buffers.
Berk Posted April 23 Posted April 23 Can someone help me understand their options with the TRS and what you think they should do with the position? I was at the COB&F charity dinner listening to the room ask / discuss the options with Brian Bradstreet and a bit of it went over my head. My understanding is that they can buyback the shares, recognize the gain from the share owners, or hold onto the position. Is this correct? From what I heard, Brian Bradstreet and Peter Clarke (at the AGM) both said that they will likely do some combination of monetizing gains and repurchasing stock. Are there any tax advantages / implications to either of these approaches?
SafetyinNumbers Posted April 23 Posted April 23 29 minutes ago, Berk said: Can someone help me understand their options with the TRS and what you think they should do with the position? I was at the COB&F charity dinner listening to the room ask / discuss the options with Brian Bradstreet and a bit of it went over my head. My understanding is that they can buyback the shares, recognize the gain from the share owners, or hold onto the position. Is this correct? From what I heard, Brian Bradstreet and Peter Clarke (at the AGM) both said that they will likely do some combination of monetizing gains and repurchasing stock. Are there any tax advantages / implications to either of these approaches? They can unwind the TRS i.e. exit the swap at various points when they come up for renewal. Whatever gains or losses are marked to market every quarter so that shouldn’t impact timing. When they exit, the counterparty is likely long FFH so the most efficient thing to do is for FFH to buy back the stock. I think they plan to retire all of the TRS via buybacks although I’m not surprised they don’t guide to that as it’s nice to keep flexibility. I think the timing is tied to valuation. Under 1.5x BV my guess is they will buyback stock in the open market and over 1.5x BV they can retire the TRS as the price paid on the TRS doesn’t really matter as they locked it in when they entered into the swap. For shareholders, the key is maintaining the investment to shareholder equity leverage. Ironically, the higher price / book on buybacks, the easier it is to maintain the ratio close to 3:1.
dartmonkey Posted April 23 Posted April 23 35 minutes ago, Berk said: My understanding is that they can buyback the shares, recognize the gain from the share owners, or hold onto the position. Is this correct? From what I heard, Brian Bradstreet and Peter Clarke (at the AGM) both said that they will likely do some combination of monetizing gains and repurchasing stock. Are there any tax advantages / implications to either of these approaches? We've discussed this frequently here and I don't think any of us really knows the pros and cons of selling this very profitable position and repurchasing an equivalent number of shares. The relevant questions, AFAICT, are tax (selling now would probably mean a big tax bill), regulatory treatment in terms of capital requirements, and volatility (if there were to be a big stockmarket drop that included FFH shares, this would hit then just when they might want some liquidity. My conclusion is that we amateurs can't really know, and I have no doubt that management will make the right decision after weighing the above considerations. In the meantime, we can either treat the TRS's as just another investment, or we can back it out the holding and reduce the share count as if the shares had been retired.
Hoodlum Posted April 23 Posted April 23 54 minutes ago, Berk said: Can someone help me understand their options with the TRS and what you think they should do with the position? I was at the COB&F charity dinner listening to the room ask / discuss the options with Brian Bradstreet and a bit of it went over my head. My understanding is that they can buyback the shares, recognize the gain from the share owners, or hold onto the position. Is this correct? From what I heard, Brian Bradstreet and Peter Clarke (at the AGM) both said that they will likely do some combination of monetizing gains and repurchasing stock. Are there any tax advantages / implications to either of these approaches? During the AGM conference call, Prem mentioned that as the share price increases they will take some off to reduce exposure. This is likely what occurred in Q4 2024. I like their comment regarding treating it like any other investment. That should give us an idea of when they might close it off. As valuation of the stock price gets to a higher p/b, then we would see more close off as well. In the interim they will continue to hold. "We'll continue to hold our TRS. As it goes up, we'll take some off for exposure purposes, but we treat it like one of our other investments."
TwoCitiesCapital Posted April 23 Posted April 23 1 hour ago, dartmonkey said: We've discussed this frequently here and I don't think any of us really knows the pros and cons of selling this very profitable position and repurchasing an equivalent number of shares. The relevant questions, AFAICT, are tax (selling now would probably mean a big tax bill), regulatory treatment in terms of capital requirements, and volatility (if there were to be a big stockmarket drop that included FFH shares, this would hit then just when they might want some liquidity. My conclusion is that we amateurs can't really know, and I have no doubt that management will make the right decision after weighing the above considerations. In the meantime, we can either treat the TRS's as just another investment, or we can back it out the holding and reduce the share count as if the shares had been retired. The TRS should are likely to be taxed quarterly as an exchange of cash flows and a reset of the position are probably on a quarterly cadence. Is how exchange traded TRS on indices work. I'm not sure the rate applied - TRS function similarly to a rolling of futures contracts, but not sure they get the same tax treatment as futures do or not.
gfp Posted April 23 Posted April 23 That is correct - I have previously asked the company and the TRS gains/losses are taxable each quarter. Conversely, trades in an issuers own common stock are not taxable to the issuer. There is not a built-up realized gain being realized when they retire a portion of the TRS position. The opportunity is to buy a block of shares from the counterparty who should hold that block of shares as their hedge to facilitate the TRS. Buying the hedge shares form the counterparty is not required but if you want the block, I"m sure the counterparty is happy to oblige
dartmonkey Posted April 23 Posted April 23 34 minutes ago, gfp said: Conversely, trades in an issuers own common stock are not taxable to the issuer. Not in the sense of capital gains, but there is a 2% tax on share repurchases in Canada.
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