It's worth noting that Orbis manage investments for multiple...

It's worth noting that Orbis manage investments for multiple funds - i.e. they are not holding CER for their own proprietary book, they run individual funds for clients.

Every time Orbis announces a CER sub holder notice, they list the actual and change in holdings for each of the funds. The Orbis sub holder notices are an aggregation of all of the Orbis CER holdings across their funds.

To work out what is actually happening, you need to break down every sub holder notice they have made into actual and change in holdings for each of the funds. This is an exceptionally time consuming and complicated process but one that we at Swap & Co. have performed. We felt it important to understand the data rather than speculate on what might be happening.

Before the current round of selling, the Orbis average cost was about 26c, but this figure is practically irrelevant. When you sit down with the owners of each of the funds, they couldn't care about your average CER cost across all funds; they just want to know about the shares you bought in their fund.

At fund level, as you might expect, a number of the funds have average costs way above the current SP. For example, SMEF is 38c, FWEF 28c. Others, like SMCS at 2.3c are way below.

The recent selling by Orbis was across a number of funds but it is important to note that it was NOT across all funds. For example, of the 2.7m shares held be Orbis for FWEF, none were sold. As another example, on 29th September when Orbis announced a reduction in their holding, GAPL actually increased its holding by 3.1m shares.

We will never know exactly why this is the case but it could just be some sensible locking-in of profits for their client funds. Even value investors take profits from time to time. In OGEF for example, Orbis had purchased shares as low as 8c.

I would also add that Orbis are long term value investors so 'trading' in and out of individual names or trying to pick top and bottom would run counter to their central strategy. Orbis run money for a number of super funds so we might also assume that they are getting inflows every quarter in line with super contributions.