Finally!…out with the old (and in with the new)
It seems to take me a long time to admit my investing mistakes. But when I finally get around to cleaning out house, there’s a wonderful feeling of liberation! The moment after you pull the trigger you ask yourself “Why?, Why did I hand on too long to a position that I knew wasn’t living up to my investment thesis?”. That’s what happened to me with MFC Industrial (MIL); I’ve known for a while that the company wasn’t performing according to my original thesis, but I held on anyway, thinking that perhaps there was a new, better thesis with the purchase of Compton Petroleum, then with the change in control to Peter Kellogg. Anyway, earlier this week I finally looked in the mirror, saw my tergiversation for what it was and took the plunge, selling the balance of my position (sorry for the delay in reporting). I finally accepted that, indeed, there were more attractive investment options out there. So I’ve recycled part of the MIL proceeds into a starter position in LMCA.
I’ve been following the Liberty family of companies, i.e. John Malone, for a long time now. I owned Ascent Media a few years back and did well with it. I looked at Liberty Ventures when that was split off but couldn’t come up with a value proposition when it started trading. Obviously I was wrong on that one as the shares soared. Then I was evaluating a position in LMCA a couple of years ago when it was trading between $70 and $80 a share but never could get comfortable with the Sirius situation. LMCA shares have advanced considerably since then, so why purchase now? The short answer is the upcoming split and spinoff of Liberty Broadband which I think will be a value realization catalyst. This post is just a ‘heads up’. I’ll be doing a more in-depth post on the Liberty Media situation as we get closer to the split date (July 23).
Always remember that I’m not advocating any investments here; do your own analysis!