Loeb's Third Point Reduced Yum! Brands Stake Last Quarter

  • Hedge fund bought new stakes in Chubb and Morgan Stanley
  • Firm exited four companies including T-Mobile US Inc. in 4Q

Third Point, the hedge fund firm run by Daniel Loeb, took new stakes in insurer Chubb Corp. and Morgan Stanley in the fourth quarter and reduced its position in Yum! Brands Inc. by almost $1 billion.

The New York-based fund bought 1.5 million shares of Chubb, worth $175 million as of Dec. 31, according to a regulatory filing Friday. Chubb was acquired by Evan Greenberg’s Ace Ltd. in January and the combined company took the name Chubb Ltd. Third Point also purchased 3 million shares of Morgan Stanley, worth $95.4 million.

The fund cut most of its position in Yum! Brands, selling 11.5 million shares and reducing the value of its holding by $921.9 million, to $5.5 million at the end of last year. The company, which owns the Taco Bell and KFC restaurant chains, is preparing to spin off its Chinese operations this year. Third Point exited stakes last quarter in T-Mobile US Inc., NXP Semiconductors NV, IAC/Interactive Corp. and Intrexon Corp.

Observing “true carnage” of some stocks in key equity indices so far this year, Third Point wrote in its fourth-quarter letter to investors Friday that “the 2015 market we dubbed a ‘Haunted House’ feels about as scary as the Disney kids’ ride ‘It’s a Small World’ when compared to 2016.”

The firm said it has increased single-name equity shorts by four-fold over the past year, bringing its total equity short exposure to nearly $4.5 billion today.

Money managers who oversee more than $100 million in U.S. equities must file a Form 13F within 45 days of the end of each quarter to list their holdings in stocks that trade on U.S. exchanges, as well as options and convertible debt. Hedge funds are lightly regulated pools of capital whose managers can invest in any asset and share in annual profits.

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