Howard Marks, founder and chairman of Oaktree Capital Management increased his stake in Exco Resources Inc (NYSE:XCO) based on a filing submitted to the Securities and Exchange Commission (SEC).

Howard Marks Oaktree Capital - Risk

The hedge fund manager increased his stake in the oil and natural gas company by 23% to 45,251,182 shares. Marks’ investment management firm held 36,778,946 shares during the third quarter.

Rights offering

Howard Marks’ investment management firm acquired 8,394,736 shares worth around $41,937,680 through a rights offering conducted by Exco Resources Inc (NYSE:XCO) on December 17, 2013. The rights offering gave shareholders the right to buy 0.25% of a share of the company’s common stock for a price equal to $5.00 per share.

Exco Resources Inc (NYSE:XCO) previously announced a rights offering worth $273 million under exercise commitment with some of its shareholders. The company estimated that 28 million shares will be issued in the rights offering out of the 54.5 million total shares of common stock expected to be issued.

The oil and natural gas company issued 19.6 million shares to WL Ross & Co., the investment management firm headed by Wilbur Ross. Prem Watsa’s Hamlin Investment Counsel Ltd also acquired 6.7 million shares.

During the third quarter, Ross owned 14.48% stake while Watsa owned 4.97% stake in Exco Resources Inc (NYSE:XCO).

As of the third quarter, Exco Resources ranks as Marks’ largest equity position, with a 4.8% weighting in his $5.2 billion portfolio of 77 stocks.

2014 capital budget and guidance

The board of directors of Exco Resources Inc (NYSE:XCO) approved a $368 million capital budget for 2014. The company expected to fund the budget using its cash flow from operations and borrowings under its credit agreement.

The company also expected to achieved about $400 million to $425 million EBITA for the full year 2014 based on the estimated $4.00 average prices for natural gas and $90 for oil NYMEX.

Howard Marks’s new memo

Howard Marks recently issued a new memo entitled “Getting Lucky” to his clients, wherein he discussed the important role of luck towards attaining success every day. Howard Marks wrote, “There’s no doubt that hard work, planning and persistence are essential for repeated success. But even the hardest workers and best decision makers among us will fail to succeed consistently without luck.”