Margate Capital

John Paulson Cub Sees “Hundreds of Billions” In Tech Industry Consolidation And Potential Apple Purchase Of Disney

When Margate Capital launched the fundraising for a long/short equity fund at the beginning of last year, the fund attracted plenty of attention thanks to the fact its managing partner and chief investment officer, Samantha Greenberg was a John Paulson cub and one of the hedge fund industry’s few female hedge fund managers.

Greenberg was rated as one of 2016’s hedge fund rising stars by Institutional Investor magazine at the beginning of the year after receiving seed capital of $130 million from New York-based asset manager Ramius. Along with the capital, Ramius also took an equity share of the business. Greenberg’s resume promised big things. After working for Goldman Sachs’ special situations group, she joined John Paulson in 2009. After leading the firm’s media and consumer investment teams for several years, she was promoted to partner in 2011.

Also, see:

Margate Capital officially began trading on 1 August 2016, and since then the fund has produced attractive returns relative to its peers. According to Margate’s fourth-quarter and end of year 2016 letter, a January 10th 2017 copy of which has been reviewed by ValueWalk, the fund’s long/short strategy returned 4.4% gross during Q4, compared to a return of 3.8% for the S&P 500. From inception till the end of the year, Margate produced an estimated return of 5% net on its DAY 1 units and 4.6% net on FOUNDERS units. Over the same period, the S&P 500 has returned 4%, while the equity long/short HF performance for the same period was only +0.28%, per data from Morgan Stanley Prime Brokerage.

During the third quarter, the fund averaged 26% net exposure and 120% gross exposure. Average long exposure was 74%, and average short exposure was -48%. Long positions added 8.7% and short positions subtracted 3.3%. The team’s targeted gross exposure is 150% to 180% and is still building out the portfolio after launch.

Margate Capital: Tech Industry Is On The Cusp Of Wave Of Consolidation
Margate Capital is a tech-focused fund. Greenberg believes that the technology industry is on the cusp of a substantial wave of consolidation and Margate Capital's position to benefit from this. Companies targeted are those “with attractive valuations and expected positive earnings revisions, but also free optionality as these companies sit in the “sweet spot” of size and desirability for strategic and financial buyers.”

Greenberg points to three major developments, which could be the catalysts that drive this major industry consolidation:


This content is exclusively for paying members. Sign up here

If you are subscribed and having an account error please clear cache and cookies if that does not work email or click chat

Saved Articles

The Life and Career of Charlie Munger

Charlie is more than just Warren Buffett’s friend and Berkshire Hathaway’s Vice Chairman – Buffett has actually credited him with redefining how he looks at investing. Now you can learn from Charlie firsthand via this incredible ebook and over a dozen other famous investor studies by signing up below:

  • Learn from the best and forever change your investing perspective
  • One incredible tidbit of knowledge after another in the page-turning masterpiece of a book
  • Discover the secrets to Charlie’s success and how to apply it to your investing
Never Miss A Story!
Subscribe to ValueWalk Newsletter. We respect your privacy.

Are you an intelligent investor?

ValueWalkPremium is a website and newsletter for smart investors like yourself. We focus on the latest hedge fund industry news much of which is not in the public domain and obtained via our sources.

We also have 10 years of resources on how to use this information to better your investment process.

Sign up for  today for only a few dollars a day and get a 3 day no obligation trial with a targeted 20% discount coupon code.

Cancel anytime during trial and you are never charged.

Limited time offer: For first 50 subscribers