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Soros ups stake in Potash Corp

Date: Thursday, February 19, 2009
Author: Sree Vidya Bhaktavatsalam and Christian Schmollinger, Bloomberg News

Billionaire investor George Soros's hedge-fund firm bought more shares of Potash Corp. of Saskatchewan Inc. in the fourth quarter, almost doubling its holdings.

Soros Fund Management LLC increased its holdings in Potash by 2.6-million shares to 2% in the fourth quarter according to a filing yesterday with the U.S. Securities and Exchange Commission. The New York-based firm also bought 16 million shares of the Petroleo Brasileiro SA, bringing its stake to 1.45%. Petrobras and Potash are now the firm's two biggest reported U.S. stocks.

Potash, the biggest maker of crop nutrients, fell by the most since Jan. 12 on Tuesday, declining 7.4%. Soros Fund is the eighth-biggest holder in shares of the Saskatoon, Saskatchewan-based company and the second-biggest in Petrobras, Brazil's state-controlled oil company.

"As long as you see through the current crisis there are a few compelling reasons to buy," Hernan Ladeuix, the head of oil and gas research at CLSA Ltd. in Singapore, said in an e-mail. "Oil prices should go up, probably strongly in coming years. Petrobras is the only large international company where you can have confidence that production can grow 5% per annum."

Soros's firm oversees US$21-billion. Its Quantum Endowment Fund returned 8% last year. That compared with an average loss of 18% by hedge funds, according to data compiled by Hedge Fund Research Inc. of Chicago.