Stocks

Baupost, Druckenmiller Buy Pioneer Natural As Einhorn Blasts The Frackers

Seth Klarman’s Baupost Group acquired a huge stake in Pioneer Natural Resources in the first quarter based on its 13F filing with the Securities and Exchanges Commission (SEC).

Baupost Group bought 3,166,937 shares of Pioneer Natural Resources worth around $517.82 million during the quarter. Its stake in the energy company accounts 8.7% of its equity portfolio for the first quarter.

Baupost Group initiated a position in Pioneer Natural Resources before David Einhorn, hedge fund manager of Green Light Capital blasted oil fracking companies earlier this month.

Also see Baupost 2014 Letter: A Tale Of Two Halves

David Einhorn Baupost
David Einhorn

Einhorn called Pioneer Natural Resources “mother fracker”

During the Sohn Investment Conference, Einhorn presented his short thesis on oil fracking companies including Pioneer Natural Resources, EOG Resources (EOG) Concho Resources (CXO), Continental Resources (CLR) and Whiting Petroleum (WLL).

He criticized oil fracking as a “business that burns cash and doesn’t grow anything.” According called Pioneer Natural Resources as the “Mother Fracker” and EOG Resources as the “Father Fracker.”

Einhorn said, “Pioneer burns cash and isn’t growing. Why is the market paying $27 billion for this company?”

Baupost other energy stockholding

Baupost also owns 13,807,230 shares of Cheniere Energy. Its stake in the company is worth $1,068 billion, which accounts 19.09% of its equity portfolio—its largest stockholding. Cheniere Energy is engaged in liquid natural gas or LNG-related businesses.

Baupost also owns 8,663,114 shares of PBF Energy, an independent refiner and supplier of unbranded transportation fuels, heating oils, petrochemical feedstocks, lubricants and other petroleum products in the United States. Its stake in PBF Energy has a market value of around $293.85 million.

In addition, Baupost also owns 7,242,354 shares of Kosmos Energy, an oil and gas exploration and production company. Its stake in the energy company is worth around $57.28 million.

Bloomberg noted that Baupost’s stake in Pioneer Natural Resources increased the value of its publicly-disclosed energy stockholdings by $678 million.

Aside from Baupost, Stan Druckenmiller, the chairman and CEO of Duquesne Family Office acquired 224,500 share Pioneer Natural Resources worth approximately $36.70 million in the first quarter.

Druckenmiller also bought 258,700 shares of Cheniere Energy worth around $20.023 million and 561,600 shares of EOG Resources worth around $51.49 million.