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The British investment fund Silchester increased its stake in the Greek national electricity company

19 September 2011 / 20:09:57  GRReporter
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No matter how gloomy the picture in Greece may seem today, things are not so bad apparently after Stephen Butt, one of the richest man in the UK decided to increase his stake in the Greek national electricity company DEH. He is the head of the investment company Silchester International Investors and some days ago raised his stake in DEH from 6.4% to 10.2%. According to the Sunday Times, his personal wealth is estimated at around € 325 million while his company manages funds of some of the most powerful businesses in the world.

The 60-year-old Stephen Butt holds 50.5% of Silchester International Investors, which in turn holds in its investment portfolio the shares of 150 companies, including the international giants Citigroup, Cisco, Johnson & Johnson, Kraft Foods, Lock-heed, Merck, Microsoft, Pfizer, Raytheon and Wal-Mart, and Electrocomponents PLC, ITV, Boots, Rentokil, Jardine Lloyd Thompson Group, South China Morning Post.

Butt and several colleagues of his from Morgan Stanley founded the company. “We wanted to sail under our own flag,” says the businessman, who got his first clients as a fund manager with Phillips & Drew, Rothschild and then Hill Samuel. “We thought we could serve clients better as an independent. We had just about the best track record in the market. We had the blessing of the consultants and a number of the clients. We had some credibility.”

 

Attempts to find financial support proved difficult at first, especially in the UK. Fortune smiled on them after the pension fund of state employees in Missouri, USA, offered them the opportunity to make a presentation that they liked eventually. "We were a bit doubtful at first." They are a big public-sector entity and we were new to the market, and small too, says Butt.  Silchester International Investors gained the confidence of the US pension fund. Then followed other clients from beyond the ocean such as foundations and other organizations of this kind, which now represent about 54% of the funds they manage.

The company credo is that investors should look for simplicity. Stephen Butt refers to the investment guru Peter Lynch, who says that he likes companies any fool can manage because it will happen sooner or later. The result is a portfolio of relatively simple companies known for their value than for their exciting growth prospects. Butt is clear that he does not try to find the next Microsoft. He cites another investment coryphaeus, Warren Buffett, who says he wants to hold good companies at fair prices in general and fair companies at good prices.

The philosophy seems to have proved successful in the long run because more than a decade Silchester has shown an average growth of 14.2% annual profit after taxes for its clients. Probably 10.6% of the Greek national electricity company does not make much difference to the overall state of the company, but it could be taken as a sign that the successful international business believes that the financial drama of Greece will have a happy end, because successful investment companies with extensive experience do not throw their money in failed ventures.

Tags: EconomyMarketsCompaniesStephen ButtSilchester International InvestorsDEH
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