market folly

In a 13G filed with the SEC, Carlos Slim has disclosed he has a 18% stake in Saks (SKS). Carlos has upped his stake from his previous 10.9% stake. Saks (SKS) responded to this action by essentially adopting a poison pill where a penalty is established for anyone who accumulates a 20% stake in the company without approval from the Board. Should be interesting to see how this plays out, seeing how Carlos is already close to that threshold.

Carlos Slim is a well-known Mexican businessman who amassed his wealth through telecom. He is known for his association with America Movil (AMX), Telcel, and Telefonos de Mexico (TMX) and was the second richest man in the world as of 2008. Slim has been busy in the markets recently. As we noted earlier, Carlos Slim had also taken a stake in Bronco Drilling (BRNC), among other actions.

Taken from Google Finance, "Saks Incorporated operates Saks Fifth Avenue (SFA), Off Fifth and Club Libby Lu (CLL). Previously, the Company also operated Saks Department Store Group (SDSG), which consisted of Proffitt’s and McRae’s (Proffitt’s) (sold to Belk, Inc. (Belk) in July 2005), the Northern Department Store Group (NDSG) (operated under the nameplates of Bergner’s, Boston Store, Carson Pirie Scott, Herberger’s and Younkers, and sold to The Bon-Ton Stores, Inc. (Bon-Ton) in March 2006), and Parisian (sold to Belk in October 2006). SFA stores are principally freestanding stores in exclusive shopping destinations or anchor stores in upscale regional malls, and the stores typically offer an assortment of luxury apparel, shoes, accessories, jewelry, cosmetics and gifts."