Tuesday, 11 December 2007

Influential Fund Manager Buys 10% of AeroMechanical

The sticks and stones in the dirty end of the business schoolyard - lawsuits and regulatory challenges - didn't deter Hugh Cleland from stealthily snapping up nearly 7.7 million shares of AeroMechancial (AMA).
Given that amount, Mr. Cleland, announced late last Friday (Dec. 7th) that he was now classified as an insider. Mr. Cleland is founder and manager of Northern Rivers Innovation Fund.
His SEDAR disclosure documents indicated Mr. Cleland piled AMA shares into his war chest before Nov. 30th, well before the Dec. 5th announcement that AeroMechanical made its first major breakthrough to enter the Chinese market.
Of note, Cleland's buying was also taking place before and after a company that claims to be an AMA competitor - Star Navigation - filed a patent infringement lawsuit against AMA and entangled AMA in a lawsuit between Star and one of its former executives. Star also asked the United States Patent Office to "review" AMA's patents.
AMA dismissed all of Star's actions as frivolous. It launched a vigorous counter offensive but despite all of that, many investors recoiled and AMA's share prices dipped.
It was obviously another buy opportunity for Mr. Cleland, in keeping, perhaps, with his fund winning the 2006 Opportunistic Strategy Hedge Fund award. Since the fund's inception in May 2001, it has enjoyed an average annual return of 36.5%, as of January 31st, 2007.
In 2006, it returned a staggering 92.5%.
Cleland earned his honours bachelor of arts degree from Harvard University in 1997 and in March 2001, his CFA designation.
Mr. Cleland regularly appears on BNN and his nice or nasty reviews on various companies have such a huge impact, executives can be instantly rendered into kings or paupers.