After increasing its stake in Navistar International Corp (NYSE:NAV) just a few days ago, Mark Rachesky‘s MHR Fund Management has further inched up its holding in the company to 15.45 million shares by acquiring another 15,400 shares through its affiliated funds, according to a 13D filing with the SEC. The holding now represents 18.9% of the company’s outstanding common stock.
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Mark Rachesky, a graduate from Stanford University, got a rich taste of activist investing while he worked for renowned activist Carl Icahn. In 1996 Rachesky launched his own fund, which currently has about $6.1 billion worth of assets under management. The market value of the fund’s public equity portfolio stood at $2.83 billion at the end of March, slightly down from $2.88 billion at the end of the previous quarter. The consumer discretionary sector represents more than 60% of the fund’s holdings and its top equity picks include Lions Gate Entertainment Corp. (USA) (NYSE:LGF), and Loral Space & Communications Ltd. (NASDAQ:LORL).
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Since June 8, MHR has indulged in three transactions that piled yet more Navistar International Corp (NYSE:NAV) shares onto its already bulging holding of the company. The price per share ranged from $23.58 to $25.49 in the latest transactions. The fund initiated a position in the $2.05 billion holding company engaged in manufacturing of commercial and military trucks, proprietary diesel engines, and school and commercial buses, in the second quarter of 2012. So far this year the stock of Navistar International Corp (NYSE:NAV) has slumped by nearly 25%. In comparison, the truck manufacturing industry has slid by 1.54% in the same time period. Although the turnaround strategy of the company’s management seems to be working, the pace of the recovery is in question, especially after the financial results for the company’s fiscal second quarter. A net loss per share of $0.78 for the quarter greatly missed the expectations by $0.60, while revenues of $2.69 billion were also $130 million lower than estimates. Carl Icahn, Rachesky’s former employer, is the largest stockholder of Navistar International Corp (NYSE:NAV) within our database, with his fund Icahn Capital LP holding 16.27 million shares valued at $480.04 million.
MHR’s largest holding, in Lions Gate Entertainment Corp. (USA) (NYSE:LGF), remained unchanged during the first quarter at 51.26 million shares valued at $1.74 billion. The holding represents 61.4% of the fund’s portfolio value. The stock price of the $5.45 billion film and television production house has appreciated by 15.3% year-to-date, which has more than offset Rachesky’s losses from his Navistar holding. Recently John Malone, the billionaire media mogul, hinted to The Wall Street Journal that a merger between Lions Gate Entertainment Corp. (USA) (NYSE:LGF) and Starz (NASDAQ:STRZA) might be in the cards, as he sees the consolidation between studios and smaller channels as a way to counter the loss of traction for traditional TV bundles. After MHR, Barry Rosenstein‘s JANA Partners is the largest stockholder of Lions Gate Entertainment Corp. (USA) (NYSE:LGF) in our database, owning nearly 6.0 million shares valued at $203.32 million.
MHR’s stake in Loral Space & Communications Ltd. (NASDAQ:LORL) was comprised of 8.13 million shares valued at $556.40 million and represented about 20% of the fund’s public equity portfolio value. So far this year, the stock of the $1.44 billion satellite communications company is down by nearly 15%. Among the billionaires that we track, three had an aggregate investment of $158.06 million in Loral Space & Communications Ltd. (NASDAQ:LORL) at the end of March. George Soros was one of them, as his family office Soros Fund Management owns about 1.06 million shares of the company valued at $72.23 million.
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