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Nebula Capital Management’s Biggest Q1 Moves

#3 Valeant Pharmaceuticals Intl Inc (NYSE:VRX)

 – Shares held by Nebula Capital Management (as of March 31): 120,000

 – Value of Holding (as of March 31): $3.16 million

The 74% drop in Valeant Pharmaceuticals Intl Inc (NYSE:VRX)’s stock during the first quarter was used by Nebula Capital Management to boost its holding in the company by 70%. Valeant Pharmaceuticals Intl Inc (NYSE:VRX) has been in the news constantly over the past few months, especially after the company reported dismal fourth quarter numbers and lowered its 2016 guidance on March 15. That coupled with the massive amount of debt on the company’s balance sheet, sent its stock tumbling during the first quarter. Following the crash in the stock, billionaire activist investor Bill Ackman, whose Pershing Square is among the largest shareholders of Valeant, swung into action by joining the company’s board, which announced major changes shortly afterwards, which included the hiring of former Perrigo CEO, Joe Papa, as the new CEO of the company. Despite the measures taken by Mr. Ackman and the company’s Board, Valeant Pharmaceuticals’ stock is showing little signs of recovery. Moreover, the company has received a lot of flak from influential investors like Jim Chanos, Warren Buffett, and Charlie Munger recently. According to a recent presentation by Pershing Square, the fund owned a nearly 9% stake in the company (including options), as of April 21.

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#2 Travelport Worldwide Ltd (NYSE:TVPT)

 – Shares held by Nebula Capital Management (as of March 31): 281,600

 – Value of Holding (as of March 31): $3.85 million

Travelport Worldwide Ltd (NYSE:TVPT) was another new addition to Nebula Capital Management’s equity portfolio during the first quarter. Shares of the Georgia-based travel commerce platform provider have gained 5.45% so far this year, but are still trading down by 14.18% from their IPO price of $16. On April 12, analysts at Sterne Agee CRT initiated coverage on the stock with a ‘Buy’ rating and $19 price target. The company recently reported its first quarter financial results, declaring EPS of $0.42 on revenue of $609 million, easily beating analysts’ EPS estimate of $0.32, but missing their $613.71 million revenue estimate. For the same quarter of the previous financial year, Travelport Worldwide Ltd (NYSE:TVPT) delivered EPS of $0.24 on revenue of $572 million. Another fund that initiated a stake in the company during the first quarter was Ben Levine, Andrew Manuel, and Stefan Renold’s LMR Partners, which purchased 199,200 shares.

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#1 Concordia Healthcare Corp (NASDAQ:CXRX)

 – Shares held by Nebula Capital Management (as of March 31): 197,000

 – Value of Holding (as of March 31): $5.04 million

Though Nebula Capital Management increased its stake in Canada-based Concordia Healthcare Corp (NASDAQ:CXRX) by 25% during the first quarter, the company dropped three spots in the fund’s portfolio during that time due to a 37.3% decline in its stock during the quarter. Before the rout in its stock, some analysts had criticized Concordia Healthcare for following the same growth-by-acquisition strategy which its fellow Canadian peer Valeant Pharmaceuticals was using. Needless to say, their concerns have been validated in the past couple of months, as shares of both companies have plummeted significantly from the levels they were trading at last year. However, shares of Concordia Healthcare Corp (NASDAQ:CXRX) spiked by 10% on April 21 after the company announced that it had formed a special committee of board members to explore strategic alternatives, which led to rumors that private equity behemoth Blackstone Group LP (NYSE:BX) might be interested in acquiring the firm. According to recent reports, the company is working with Greenhill & Co. to search for potential acquirers and is in early stage talks with buyout firms including Apollo Global Management LLC and TPG. However, no offers have been made as of yet.

Disclosure: None

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