Hedge fund Lone Pine Capital reveals new 5% stake in Lululemon

Connecticut-based fund has 6,446,607 shares, which are worth about US$371.5 million   

Vancouver-founded Lululemon has its flagshop Vancouver store at the corner of Robson and Burrard streets | Rob Kruyt

Connecticut-based hedge fund Lone Pine Capital revealed in a filing January 29 that it has taken a 5% stake in Lululemon Athletica Inc. (Nasdaq:LULU).

The 13G filing on the U.S. Securities and Exchange Commission website, Edgar, revealed that Lone Pine Capital has 6,446,607 shares, which are now worth about US$371.5 million, given Lululemon’s closing share price of US$57.63.

Lululemon shares then rose close to 1.75% to US$58.64 after hours, when the filing was revealed.

Steve Mandel, who manages Lone Pine Capital, reportedly has about US$17 billion under management and has a personal net worth that is about one tenth of that.

Other institutional investment firms that have stakes in Lululemon include Citadel Investment Group, Point72 Asset Management, Balyasny Asset Management, Scopus Asset Management and Melvin Capital Management.

Then, of course, there’s the private equity firm Advent International, which was involved when Lululemon founder Chip Wilson took the company public in 2005. Wilson then sold a 48% stake to both Advent and Highland Capital Partners.

Wilson announced in 2014 that he planned to sell 20.1 million shares in the yogawear giant, or half of his then 27% holding, to Advent for US$845 million.

Wilson, at the time intended to keep a 13.85% stake in Lululemon.

That changed in mid-2015, when Wilson noted in a securities filing that he, his wife Shannon Wilson and a holding company that the two control all planned to sell their entire remaining stake in the company.

gkorstrom@biv.com 

@GlenKorstrom