Lansdowne Dumps Prudential Short After Four Years

Apr 25 2013 | 10:59am ET

Lansdowne Partners is throwing in the towel on Prudential.

The hedge fund has been shorting the insurer's shares for more than four years. The bet has proven a disaster: Pru's shares have doubled since Lansdowne opened its position, during or before January 2009.

And thing's won't be getting any better for Lansdowne or worse for Pru, the hedge fund told clients this month. Lansdowne said it had determined that Pru shares are unlikely to fall "any time soon."

Lansdowne exited the position, which was valued at £259 million (US$360 million) last month, during the first quarter, Bloomberg News reports.

Lansdowne had been betting that Pru's Asian growth being unsustainable, and it hasn't abandoned that thesis. The hedge fund called the decision to close the short "doubly frustrating," but added, "we suspect our ability to judge the point at which evidence is accruing will be better done through a neutral position for the moment."

It is unclear how much the US$12.4 billion hedge fund lost on its investment.


In Depth

Q&A: TCA Fund Management's Bob Press on Small-Cap Private Equity

Aug 25 2016 | 8:55pm ET

The emergence of private credit as a replacement for traditional bank financing...

Lifestyle

Kiawah: Island Reversal

Aug 24 2016 | 9:59pm ET

Looking for real estate investments but the typical real estate fare isn’t cutting...

Guest Contributor

Old Hill Partners: Embrace Illiquidity

Aug 9 2016 | 2:39pm ET

The age-old financial concept that higher yields are the result of higher risk and...