Fairfax 2024

[KFRCanuk]

7 hours ago, maplevalue said:

Closed the year at exactly $2000!

December 29, 2023 close was $1228.90! What a year !! Repeat in 2025!

Edited Wednesday at 05:11 AM by KFRCanuk

[backtothebeach]

Even better adjusted for the dividend.
 

Return in 2024:
+53% in USD

+66% in CAD

 

Congrats to all! A huge shoutout and thank you to @Viking, @SafetyinNumbers, and all others who so generously share and discuss Fairfax here. And to @Parsad especially for making it all possible.

[villainx]

On 12/30/2024 at 7:50 PM, Viking said:

I have family coming over tonight for dinner...

 

Feel like you are leaving us hanging a little here.  What was dinner and how was it?

 

[bluedevil]

On 12/30/2024 at 2:22 PM, SafetyinNumbers said:

FFH owns 20% of Ki via Class A shares but 60% of the shares are held by preferred shares similar to what FFH just bought back from OMERS in Brit. They are structured to be paid back with new shares at the listing price so effectively FFH has 40% ownership which will be diluted on IPO. I do think 5-10x premiums is not unreasonable for an AI powered insurance startup growing premiums exponentially backed by Blackstone. I didn’t previously appreciate how these minority interest structures were materially understating FFH economics. Those benefits will also come in when Allied World and Odyssey are bought back in over the next few years. 

 

 

 

 

Can you say more about why Fairfax "effectively" has 40% ownership of Ki?  The filings ive seen say that Fairfax owns Class A (20%), while BX owns Class B and Class C (80%), excluding a smaller number of shares for the CEO.  See eg the full accounts from 2023. 

I confess i have not tried to go through the documents with a fine tooth comb, but i haven't seen something that suggests Fairfax enjoys 40% of the economics, nor do i follow why BX being repaid with new shares at the listing price would double Fairfax's economics.  Not doubting it, just trying to understand.  

 

Personally, I would be very happy if Ki IPOs at a 3 billion valuation, or 3x.   Digit -- a very exciting asset -- IPO'd with about 1 billion of premium and IPO'd at a 3bn value.

[SafetyinNumbers]

3 hours ago, bluedevil said:

 

 

Can you say more about why Fairfax "effectively" has 40% ownership of Ki?  The filings ive seen say that Fairfax owns Class A (20%), while BX owns Class B and Class C (80%), excluding a smaller number of shares for the CEO.  See eg the full accounts from 2023. 

I confess i have not tried to go through the documents with a fine tooth comb, but i haven't seen something that suggests Fairfax enjoys 40% of the economics, nor do i follow why BX being repaid with new shares at the listing price would double Fairfax's economics.  Not doubting it, just trying to understand.  

 

Personally, I would be very happy if Ki IPOs at a 3 billion valuation, or 3x.   Digit -- a very exciting asset -- IPO'd with about 1 billion of premium and IPO'd at a 3bn value.

That’s how I interpret the articles I attached above. I’m not a lawyer so could definitely have it wrong! I’m wrong a lot as I’m always trying to fill in the blanks when provided with incomplete information. This sort of structure does make sense and is consistent with other deals Fairfax has done except with this option to IPO. It’s really brilliant if that’s in fact the intent. It’s a home run for FFH and BX so it makes sense that’s how it works.

 

I took a screen shots of some key parts in the articles that influenced my thinking. I figure we’ll learn more at the AGM at the latest so it’s not that important except it highlights the abundance of material right tails that are in the portfolio.

[bluedevil]

Got it, thank you. 

I think you are right, which is awesome.

BX owns 60% and FFH owns 40% of the "true" equity

BX owns a large chunk of Class C stock that can be repurchased at an 8% IRR