SHLD…Updated "Short" Math

Some updated Short Math…

Holder Name—Shares—%

ESL Investments, Inc.—65,639,184—51.0%
Fairholme Capital Management LLC—16,110,090—12.5%
Legg Mason Capital Management, Inc.—12,503,168—9.7%
Pershing Square Capital Management—6,746,568—5.2%
ClearBridge Advisors—4,789,523—3.7%
Perry Capital—2,694,95—22.1%
Davis Advisors—2,020,96—11.6%
Dalal Street, Inc.—517,608—0.4%
T2 Partners Management LP—50,625—0.0%
Greenlight Capital, Inc.—11,240—0.0%

Total held by above—111,083,919—86.2%

Total Outstanding—128,800,000

Short Interest—33,656,888—26.1%
Share Not held by Above Holders—17,716,081—13.8%

Here is why I added some shareholders to the list.

ClearBridge Advisors is actually owned by Legg Mason and considering Bill Miller’s influence at the entire firm I wouldn’t think it is crazy for the ClearBridge PMs and analysts to be communicating with or with directly with Bill Miller and his team.

Perry Capital is a no brainer to be added to the list as Rchard Perry is actually on the Board of Directors at SHLD. One other interesting tidbit is that Richard Perry worked on the Arb desk at Goldman during the Robert Rubin years (according to this months Fortune magazine). This is te same desk that Eddie Lampert worked on.

Dalal Street (Mohnish Pabrai), Davis Advisors, Greenlight (David Einhorn) and T2 (Whitney Tilson) are all well known for being value guys who will hold onto positions for extended periods as long as the position is trading sufficiently below intrinsic value. Einhorn, Tilson and Pabrai will all be presenting at the upcoming Value Investor Congress.

So over 86% of the shares outstanding are being held by long-term value investors which is really a great sign. The shares sold short is almost double the number of shares that we estimate are in the trading float…but the real question is does it really matter? If the long-term holders listed above hold their shares in a margin account, then those shares can be borrowed and shorted. So the answer to the question really is no. However if all these holders were to move their holdings to the cash account or requested their share not be lent out then that would create a situation where the maximum number of shares that could be borrowed at approximately 17.7mm.

Disclosure (“none” means no position): Long-SHLD
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