Pabrai Investment Funds Annual Meeting Notes

Mohnish Pabrai is the principle investor and is a classic value investor in the tradition of Warren Buffett and Charlie Munger
Pabari Funds ( PF1 through 4 ) have a combined capital of $690 Million under management
Inception : 2000

Value Proposition :

No Leverage / No Margin / No Short Positions
No management fees, only performance fees. ( typical expense ratio of Pabrai funds are between 0.04% to 0.08% )
Pabrai family is the second largest investor.

Dhandho Holdings :

Founded in Q4 2013
Raised $152.4 Million
Setup as a SPAC ( Special purpose acquisition vehicle )
- Flexible vehicle – Ability to buy and hold fully owned subsidiaries for long term and portfolio of stocks
- Time limit (sunset) to invest funds raised from investors in proposed investment (Stone Trust Insurance )
Headquartered in Porte Rico – for tax benefits
First acquisition : Stone Trust Insurance
Proposed date for IPO : 2015

Mutual insurance company with 5000+ policy holders
- Primarily into workers comp insurance
- Serving five starts in U.S in 2014 ( expected to expand to ten or fifteen stats in ten years )
Earned $70 million in annual premium ( compared to $20 million in premiums in 2009 and $10 million in premiums 2004 )
Expect combined ratio of 95 or lower over long term
Dandho Holdings will infuse a capital of $30 million after acquiring Stone Trust Insurance for $35 million

Dhandho’s cash surplus and backing will allow Stone Trust Insurance to grow without capital constraints.
Boost’s Stone Trust’s credit rating from B+ to A- post acquisition
Single investor ( Mohnish Pabrai himself ) managing investments for Stone Trust ( Clone of Buffet’s model for Berkshire )
Environment where the focus is on under writing discipline and not growth
Dhandho will provide a non-institutional environment, which is important for success in insurance business