Longleaf Partners - Q3 2009

Some position discussions (http://www.longleafpartners.com/pdfs/09_q3.pdf):

• Japan Petroleum. Japex also declined and sells at a discount to the value of its public stake in INPEX with no credit given for the company’s oil and gas assets.
• NipponKoa. For the year NipponKoa has declined 16%. NipponKoa appreciated in the third quarter, but has been the largest detractor from 2009 performance. The proposed merger with Sompo will be voted on in December, and Southeastern has been explicit with management regarding the terms we must see in order to support the marriage. We believe the company needs our votes for the merger to occur. If the joint company is structured as we advocate, a unique company will be created, and we should reap handsome returns. If the merger fails, shareholders have alternative options for closing the large gap between NipponKoa’s price and its intrinsic value.