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US fund manager Fidelity Investments takes Xero shareholding

Tuesday 9th December 2014

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US fund manager Fidelity Investments, with US$4.9 trillion under management, has built up a substantial shareholding in local software developer Xero.

The global investor has taken a 5.4 percent stake in Xero, making it the fifth biggest shareholder in the accounting software firm, according to a filing with the NZX. Since Sept. 25, Fidelity, via its FMR LLC unit, has been buying shares in Xero between $15.84 and $21.61 a share, and holds 6.9 million shares in the Wellington-based company.

That ranks the fund manager behind chief executive Rod Drury's holding at 17 percent, Craig Winkler's 14 percent stake, Boston based Matrix Capital's 9.8 percent holding, and Silicon Valley investor Peter Thiel's 6.7 percent investment.

Shares of Xero fell 2.9 percent to $16.01, and have plunged from a peak of $45.99 in March when it was caught up in a global sell off of momentum stocks in the biotech and IT sectors, and as investors weigh up the software developer's plans to expand in North America.

The stock is rated an average 'sell' based on five analyst recommendations compiled by Reuters, with a median price target of $18.50.


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