Sprint Nextel Corporation (S), Arbitron Inc. (ARB): This Hedgie Was Heavy On The M&A Front Last Quarter

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Editor’s Note: Related tickers: Virgin Media Inc. (NASDAQ:VMED), Liberty Global Inc. (NASDAQ:LBTYA), Arbitron Inc. (NYSE:ARB), Nielsen Hldg NV (NYSE:NLSN), SemGroup Corp (NYSE:SEMG), Chesapeake Energy Corporation (NYSE:CHK), Sprint Nextel Corporation (NYSE:S), DISH Network Corp. (NASDAQ:DISH), DineEquity Inc (NYSE:DIN)

Halcyon Asset Management is managed by John Bader and is multi-strategy hedge fund specializing in the credit, merger, and special situations fields.The fund recently filed its 13F with the SEC, describing some of its main investments during 2013’s first quarter. It’s important to take a look at the fund’s favorite holdings, because research has shown that retail investors can benefit from watching hedge fund sentiment; discover the details of this strategy.

Sprint Nextel Corporation (NYSE:S)

The top five

The fund’s largest equity holding declared in the 13F is in telephone and Internet company Virgin Media Inc. (NASDAQ:VMED), consisting of 1,468,121 shares worth $71.894 million at the time of filing. This position seems to be initiated during the quarter, as there is no listing of it in the prior 13F.  Virgin Media Inc. (NASDAQ:VMED) has been in a substantial uptrend for the past year, more than doubling in price, and is trading at $51.18, near the 52-week high, at the time of writing. The company reported revenue of 1,043 million and operating income of$150 million during first quarter of 2013.More importantly, Liberty Global Inc. (NASDAQ:LBTYA) has recently acquired Virgin Media Inc. (NASDAQ:VMED), and so it is likely to be delisted from the NASDAQ, as the London Stock Exchange (LSE) has recently announced a similar move.

Next up for consideration is the consumer research company Arbitron Inc. (NYSE:ARB), with 1,162,946 shares held, worth $54.507 million, as of the time of the 13F filing. This is a substantial increase in stake size from the prior quarter, with only 343,481 shares held by the fund on December 31, 2012.  Arbitron Inc. (NYSE:ARB)’s price action has been flat during 2013, following a massive gap up in mid-December 2012, and is currently trading near $47, still very close to its 52-week high. The gap up was in response to the announced acquisition by Nielsen Hldg NV (NYSE:NLSN) on December 18, 2012. Arbitron Inc. (NYSE:ARB) reported net income for the 2013 first quarter at $16.3 million or $0.60 per share (diluted), compared with $17.8 million, or $0.64 per share (diluted), for the corresponding quarter of 2012.

The next largest equity holding of the fund is in oil and gas transporter SemGroup Corp (NYSE:SEMG). Price action for this stock during 2013 has been impressive, trading from $40 in January to very close to its 52-week high at $55.28, as of the time of writing.During 2013’s first quarter, SemGroup Corp (NYSE:SEMG) reported revenue of $287.7 million with net income of $43.4 million, working out to $1.03 per diluted share, compared with revenue of $315.8 million, with net income attributable of $21.1 million, or $0.50 per diluted share, for the fourth quarter of 2012.

Shares aren’t particularly cheap, but earlier this month, the company bought Mississippi Lime Midstream assets from Chesapeake Energy Corporation (NYSE:CHK); it’s intriguing to see an investor betting on the other side of Chesapeake’s asset sale program. Generally speaking, however, SemGroup Corp (NYSE:SEMG)’s purchase should boost investor optimism, and further reward shareholders.

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