The Paulson Investment The recent investment by by the Paulson Investments Co. brings up questions as to why ?
Is it just that they want a gold stock mid tier and now see KL as undervalued and AEM now overvalued?
As pointed out by JJ'sTaxi the Paulson firm has a reputation of trying to get a board seat and then pushing a change agenda but considering the size of their investment I think thats unlikely.
They would need to greatly expand their position to have any appreciable effect on KL. I don't think Tony will be losing any sleep over it unless they do.
1.5 million shares doesn't even put them in the top 10 of KL holders in fact its less than ½ of the 10th place holder according to stockhouse records of Institutional holders.
With over 277 million shares out the 1.5 million share purchase represents just over a 0.5 % position not likely to sway many larger holders unless they decide to take a more serious sized holding and not likely to get them a board seat.
The description of the Paulson Company on Wikipedia (first 2 paragraphs) reads as follows :
Paulson & Co. Inc. is an American investment management firm, established by its president and portfolio manager,[1] John Paulson in 1994.[2] Specializing in "global merger, event arbitrage and credit strategies",[1] the firm had a relatively low profile on Wall Street until its hugely successful bet against the subprime mortgage market in 2007.[3]
Headquartered in New York with offices in London and Dublin,[1] the company operates as a partnership,[4] managing eight hedge funds as of 2013.[5] It has approximately 120 employees,[4] and $8.7 billion in assets under management.[6] The firm primarily provides its services to pooled investment vehicles, but also caters to banking or savings and loan institutions. It employs "fundamental analysis" to make its investments which may include "merger arbitrage, long/short, and event-driven strategy"
Its anyones guess what the're up to , I think they just want a gold mid tier exposure with better upside but they could be thinking KL is ripe for a leveraged takeover as well.