Penn Virginia shares soar on Soros stake

George Soros' Soros Fund Management L.L.C. praised Penn Virginia management while also suggesting the company consider a sale.
George Soros' Soros Fund Management L.L.C. praised Penn Virginia management while also suggesting the company consider a sale. (Bloomberg)
Posted: March 20, 2014

Shares of Penn Virginia Corp. soared Tuesday after billionaire George Soros' investment fund announced it had taken a large stake in the "undervalued" Radnor oil and gas exploration company.

In a statement to the U.S. Securities and Exchange Commission, Soros Fund Management L.L.C. said it had spent $29.1 million to buy a six-million-share, 9.1 percent stake and wants the company to consider a sale to boost its value.

Penn Virginia shares rose 15.6 percent Tuesday in heavy trading on the New York Stock Exchange, closing up $2.12 at $15.73.

Soros is chairman of the management fund, also known as SFM L.L.C., and his son Robert is president and deputy chairman.

In its filing, the activist investors said that Penn Virginia "has been very well-managed" and that financial incentives for the management team "should be enhanced."

But they also said management needed to "explore strategic alternatives as a means to enhance or maximize shareholder value" - usually code for putting themselves up for sale.

Soros also said his group may buy more Penn Virginia stock or debt and hedge its investments in the firm.

Penn Virginia officials did not respond to calls and an e-mail Tuesday.

Penn Virginia has a long history in the coal and gas business, but has been shifting its investments to more profitable shale-oil resources in recent years.

The company last year dramatically expanded its holdings in the oil-rich Eagle Ford Shale in south Texas. It also has a smaller acreage position in Pennsylvania's Marcellus Shale formation.


amaykuth@phillynews.com

215-854-2947 @maykuth

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