Fairfax stock positions

[SafetyinNumbers]

23 minutes ago, nwoodman said:

Thanks for this I must confess I find it a bit of a head scratcher.    There’s no regulatory or listing requirement that I can find that mandates conversion prior to admission. Logically, you’d expect them to retain optionality, collect interest, keep a senior claim, and convert when the equity rerates post-float. These came up as possible reasons after polling various AI sources, none of them overly convincing:

 

 

 

 

 

 

 

 Does seem strange as the exchangeable were initiated in March 2025 and the LSE listing was well and truly on the cards then. I also can’t see a tax angle either.  So perhaps it’s a simple as optics.

 

BTW I think that closing price in your post may be a bit early but will be the case at some point

I wonder if it was just easier and maybe cheaper to issue exchangeables instead of equity. There didn’t seem to be a coupon on the bond and they exercised them just before the €1.50 dividend went ex. Increasing the share count will also help increase the float which helps ETF demand upon listing on the LSE.

[nwoodman]

2 hours ago, SafetyinNumbers said:

I wonder if it was just easier and maybe cheaper to issue exchangeables instead of equity. There didn’t seem to be a coupon on the bond and they exercised them just before the €1.50 dividend went ex. Increasing the share count will also help increase the float which helps ETF demand upon listing on the LSE.

Good one, as the shares were issued from Treasury this makes sense

[anshulp]

On 7/3/2025 at 5:11 PM, Redskin212 said:

Great article in Bloomberg on Greece's turnaround that prominently features Prem

 

Greece's Economy Rewards Believers in Turnaround From 2015 - Bloomberg

Greece's Economy Rewards Believers in Turnaround From 2015 - Bloomberg (1).pdf

PDF for those interested 

Edited July 6, 2025 by anshulp
not sure download is working

[Santayana]

2 hours ago, anshulp said:

PDF for those interested 

Thank you!

[Viking]

9 hours ago, anshulp said:

Greece's Economy Rewards Believers in Turnaround From 2015 - Bloomberg (1).pdf

PDF for those interested 

@anshulp thanks for posting  

[Hoodlum]

The Keg Royalty Income Fund holders will be voting on Aug 1 with respect to the offer from Fairfax.  

https://financialpost.com/globe-newswire/the-keg-royalties-income-fund-announces-receipt-of-interim-order-and-filing-of-special-meeting-materials-in-respect-of-proposed-transaction-with-fairfax

 

[Viking]

How is Fairfax's investment in Metlen performing? Very well.

 

Fairfax invested about $250 million, with much of the investment happening in late 2022. Today it has a MV of $650 million, an increase of $400 million (not including dividends received or interest paid on the exchangable bonds). Melten is Fairfax's 8th largest holding today.

 

On Aug 7, 2025, Melten will IPO on the LSE (it will retain a secondary listing on the Athens exchange. Given its size (market cap) Metlen is a strong candidate to be added to FTSE100.

 

Euro strength versus the US$ has been a strong tailwind for the MV of Fairfax's large position in Melten.  

 

[Viking]

Another week... time for another Eurobank update. In Q2, Fairfax's stake was up about $900 million. 10 days into Q3, it is up another $300 million. Pretty crazy. With a MV of $4.4 billion, this is becoming a monster sized position for Fairfax.

 

It appears all Greek banks are getting re-rated higher. The weak US$ is another tailwind.

 

Excess of FV over CV at Fairfax continues to blow out (get bigger).  

 

Edited July 10, 2025 by Viking

[mananainvesting]

Pretty crazy that the Eurobank position is getting close to 50% of the Mcap of fairfax just 5 years ago! Nuts, wonder what the next 5 years holds. 

[Hoodlum]

Recipe has acquired the Olive Garden locations in Canada with plans to expand. 

 

https://www.newswire.ca/news-releases/recipe-restaurants-unlimited-acquires-canadian-olive-garden-locations-signs-national-expansion-deal-845292792.html

 

Recipe Unlimited ("Recipe") today announced that it has completed the acquisition of all eight Olive Garden restaurants located in Canada from Darden Restaurants, Inc. (NYSE: DRI). In addition to the acquisition, Recipe has entered into a comprehensive development agreement with Darden to significantly expand the Olive Garden brand across Canada.

[Hoodlum]

Fairfax has sold Praktiker Hellas in Greece for $120Euro.  I have not seen this company mentioned since their 2020 report, so I don’t know what value it was carried at on its books. It also looks like Eurobank sold property they owned as part of this deal. 
 

https://www.romania-insider.com/dedeman-praktiker-takeover-greece-july-2025?amp
 

 

Edited July 17, 2025 by Hoodlum

[SafetyinNumbers]

5 hours ago, Hoodlum said:

Fairfax has sold Praktiker Hellas in Greece for $120Euro.  I have not seen this company mentioned since their 2020 report, so I don’t know what value it was carried at on its books. It also looks like Eurobank sold property they owned as part of this deal. 
 

https://www.romania-insider.com/dedeman-praktiker-takeover-greece-july-2025?amp
 

 

It looks like based on the purchase price, it was probably marked at zero.

 

[Hoodlum]

1 hour ago, SafetyinNumbers said:

It looks like based on the purchase price, it was probably marked at zero.

 

Thanks @SafetyinNumbers   I was thinking the same that this was marked to zero.  It looks like Fairfax is working towards monetizing their Greek investments. 

[gfp]

Why would a 100% owned subsidiary be marked to zero?  This is not equity method accounted.  I'm sure it isn't marked at a lot but I don't know why you would assume zero.

[TwoCitiesCapital]

Typically, wholly owned subsidiaries are consolidated. So it would be on the balance sheet as the value of their real estate, stores, and inventory, and any other assets. 

 

Am guessing the sale price reflects a multiple of book, so should still be positive to Fairfax BV. 

[SafetyinNumbers]

1 hour ago, gfp said:

Why would a 100% owned subsidiary be marked to zero?  This is not equity method accounted.  I'm sure it isn't marked at a lot but I don't know why you would assume zero.

Just because they have likely taken out more dividends than their original cost basis and potentially earnings since acquisition but you are correct if they have reinvested a lot of capital than it would be higher.

[gfp]

2 minutes ago, SafetyinNumbers said:

Just because they have likely taken out more dividends than their original cost basis and potentially earnings since acquisition but you are correct if they have reinvested a lot of capital than it would be higher.

presumably there were earnings being earned 

[SafetyinNumbers]

5 minutes ago, gfp said:

presumably there were earnings being earned 

Yes but also potentially dividends. They clearly did a sale leaseback on the real estate as well.

[gfp]

12 minutes ago, SafetyinNumbers said:

Yes but also potentially dividends. They clearly did a sale leaseback on the real estate as well.

 

Where did you see the news about the sale / leaseback on the real estate?  The only thing I saw was quoted above "still owns real estate with a current value in excess of our purchase price."

 

I don't doubt they did it, I just haven't seen anything about it

[Hoodlum]

Antenna Group is another investment in Greece I haven't found much information on .   According to the press release on their web site, Fairfax increase their ownership to 15% in Jan 2023 with additional funding. 

 

https://www.antenna-group.com/antenna-group-agrees-with-fairfax-financial-on-investment-in-antenna-plus/

 

Late last year, Antenna Group tried unsuccessfully to acquire Time Group from Bernie Benioff for $150m.  So it would seem this could be a sizable and growing entity, but I have no idea on what the valuation could be.  

 

Antenna Group appointed Henning Tewes as new CEO in December, previously having senior roles at RTL Group ($5b media company).  It is interesting to see some of the names on Antenna's advisory board.

 

https://www.antenna-group.com/antenna-group-appoints-henning-tewes-as-group-chief-executive-officer/

 

I do wonder if we will see Antenna get monetized at some point through either an IPO or acquisition.

 

 

Edited July 17, 2025 by Hoodlum

[jbwent63]

2 hours ago, gfp said:

Why would a 100% owned subsidiary be marked to zero?  This is not equity method accounted.  I'm sure it isn't marked at a lot but I don't know why you would assume zero.

Correct. Acquisitionco would carry the investment at its cost, which would only be adjusted for additional purchases or sales/redemptions. On consolidation of the subsidiary the earnings since acquisition flow through consolidated retained earnings, but do not impact on the cost. Dividends also flow through the income statement and do not impact on the carrying cost of the investment. The capital on the target at the date of the acquisition would be eliminated on consolidation against the purchase price with the excess being recorded as an intangible asset (typically goodwill, could be other intangibles). If the purchase price was EUR 21 million and there have been no other capital transactions, then the gain would be recorded against this cost. If there was a sale and leaseback this would have presumably been at the opco level and would not be recorded at the acquistitionco level. The only other reason to adjust the cost basis would be impairment, but I dont think there was any relating to this investment.

[SafetyinNumbers]

20 minutes ago, gfp said:

 

Where did you see the news about the sale / leaseback on the real estate?  The only thing I saw was quoted above "still owns real estate with a current value in excess of our purchase price."

 

I don't doubt they did it, I just haven't seen anything about it

Just filling in the blanks from the article that the buyer also bought the underlying real estate from Eurobank which was presumably the partner in a sale leaseback. I’m making some assumptions for sure. Not that it matters much.

[Viking]

41 minutes ago, gfp said:

 

Where did you see the news about the sale / leaseback on the real estate?  The only thing I saw was quoted above "still owns real estate with a current value in excess of our purchase price."

 

I don't doubt they did it, I just haven't seen anything about it

 

Doing a quick Google search I came across two sale/leasebacks. Not sure how many of these transactions were done/how much of the property was owned by Grivalia/Eurobank.

Grivalia Properties Sept 30, 2015 Report

 

On March 18, 2015, the Company, following the permission granted from the Annual General Shareholders Meeting held on March 17, 2015, completed the transaction relating to the acquisition of a property from Praktiker Hellas SA located in Heracleion, Crete and its immediate long term lease back to Praktiker. The acquisition price was €8.500 (excluding acquisition costs of €62). The fair value of the property as evaluated by independent valuators at the acquisition date was €8.830. It is noted that the acquisition was financed through the existing funds of the Company which originated from its 2014 Share Capital Increase.

 

On May 19, 2015, the Company following the permission granted from the Extraordinary General Shareholders Meeting held on August 28, 2014, completed the transaction relating to the acquisition of a property from Praktiker Hellas SA located in Mandra, Western Attica and its immediate long term lease back to Praktiker. The acquisition price was €6.500 (excluding acquisition costs of €48). The fair value of the property as evaluated by independent valuators at the acquisition date was €7.905. It is noted that the acquisition was financed through the existing funds of the Company which originated from its 2014 Share Capital Increase.

 

https://www.athexgroup.gr/en/documents/10180/43442/Financial Statement - Full Notes GRIVALIA PROPERTIES R.E.I.C. (2015%2CNine-Month Statement%2CBoth).pdf/4441ee77-b86d-4a02-93e8-8980db1984a4

Edited July 17, 2025 by Viking

[Crip1]

14 hours ago, Hoodlum said:

Fairfax has sold Praktiker Hellas in Greece for $120Euro.  I have not seen this company mentioned since their 2020 report, so I don’t know what value it was carried at on its books. It also looks like Eurobank sold property they owned as part of this deal. 
 

https://www.romania-insider.com/dedeman-praktiker-takeover-greece-july-2025?amp
 

 

Two dispirate thoughts:

 

What a change from a decade ago when conversations like this would be focused on “How badly they did on an investment their getting rid of” as opposed to the current “How can we calculate how much money they made on this investment”. 

Fairfax and EuroBank are down today on the news. That’s not remotely bothersome, but it’s curious as I can’t see anything here that can be painted as a negative to the short, intermediate or long term value of either firm. Just strange. Years ago there would seem to be a 2-3 day delay in FFH pricing appreciation when they released positive earnings. It was really odd, but it was consistent for multiple quarters. Maybe a redux of that? Either way, this looks to be another example of monetizing value that we had very little, if any, knowledge of. 

 

-Crip
 

[Hoodlum]

5 minutes ago, Crip1 said:

Two dispirate thoughts:

 

What a change from a decade ago when conversations like this would be focused on “How badly they did on an investment their getting rid of” as opposed to the current “How can we calculate how much money they made on this investment”. 

Fairfax and EuroBank are down today on the news. That’s not remotely bothersome, but it’s curious as I can’t see anything here that can be painted as a negative to the short, intermediate or long term value of either firm. Just strange. Years ago there would seem to be a 2-3 day delay in FFH pricing appreciation when they released positive earnings. It was really odd, but it was consistent for multiple quarters. Maybe a redux of that? Either way, this looks to be another example of monetizing value that we had very little, if any, knowledge of. 

 

-Crip
 

 

Fairfax is down but that will likely change after their Q2 results are released.  I think we are now past the 2-3 days delay in stock appreciation after results and so I expect a jump in Fairfax share price on Friday Aug 1st.  Fairfax's stock price is still very much reporting results driven, as there seems be very little appreciation for what is occurring during the quarter, even after analysts spell it out.  

 

I am seeing Eurobank stock just off their all-time high, so that will likely continue increasing this quarter.  Metlen is expecting to list on the LSE on Aug 4th and that will be interesting to watch as well.  I think we will hear more regarding Fairfax's Greek investments over the coming months and year.