Dodge & Cox Sells Remaining Fannie Stock; Big Bet Gone Wrong
February 11 2009 - 3:33PM
Dow Jones News
Dodge & Cox, among the largest mutual-fund companies that
made a big bet on Fannie Mae (FNM) last year, has finally given
up.
San Francisco-based Dodge & Cox sold the rest of the 63.59
million shares of the government-backed mortgage investor that it
owned, according to a regulatory filing by Fannie Mae.
A Dodge & Cox spokesman declined to comment.
The fund manager disclosed in a securities filing in August that
it owned about 120 million Fannie shares, or 12% of the total, up
from 1.2% at the end of March last year. In August, Fannie shares
ranged in trading from a low of $4.40 to a high of $13.60.
In early September, the mortgage titan and its sister company,
Freddie Mac (FRE), were taken over by the government. In a move
that wiped out shareholder value, federal regulators seized control
of the management of the two companies under a conservatorship amid
concerns about their capital reserves and growing losses on
mortgages.
As of September 30, Fannie had 1.07 billion common shares.
Shares of Fannie Mae traded at 59 cents Wednesday, up 4 cents.
Freddie shares were changing hands also at 59 cents, up 4 cents in
New York Stock Exchange composite trading.
-By Aparajita Saha-Bubna, Dow Jones Newswires; 617-654-6729;
aparajita.saha-bubna@dowjones.com
(James R. Hagerty contributed to this report.)