Investing in stocks is often a solitary sport where independent thinking is a valuable quality. This does not mean that our success depends to 100% of our ideas. Fortunately for us, there are brilliant investor, with an incredible talent for wealth creation and who are little known to the public (this is not an article on Warren Buffett). The beauty of stock markets is that they allow us to partner with such a specimen when we finds one. What’s easier than buying some shares and then leave it to our “new partner” with the task of working heart and soul to our enrichment!

I believe Chad Wasilenkoff, founder and CEO of Fortress Paper is one of these buffettesque individuals obsessed from an early age with money accumulation. His personnal story is not mundane (he his only 37 years old) and contains some similarities with that of Nebraska most famous investor. At 10 years old, Wasilenkoff hired his friends to recover golf balls lying at the bottom of ponds. He then sold them with a tidy profit to golf club clients (a kid in Omaha was doing the same in the 30s). As a teenager, he developed a business around reselling Atari’s computer games (the teenager of Omaha rented pinball machines in an other era …). Our ambitious teen then expanded its business from the sale of videogames to that of bicycles to that of used car!

Then came adulthood and serious matters. His first big coup was the takeover in 2003 of Dynasty Metals for $ 1 million. The subsequent rise of gold price from $ 300 to $ 700 did inflate the market capitalization of the company to $ 150 million! Wasilenkoff repeated the same trick in 2004 with the acquisition for a pittance of Titan Uranium, while the uranium price was at a bottom. The rest is history… the uranium price exploded from $ 10 to nearly $ 100 a pound and Wasilenkoff had the flair to sell its stake at the top!

The creation of Fortress Paper in 2006 by the acquisition of two paper mills of Mercer International follow the same logic. Again, Wasilenkoff buy cheap assets in a sector in disfavor (pulp and paper). Although cheap, those mills are quality assets that he believes will worth much more  in the coming years (see my analysis). As the owner of 25% of the company’s stock, his interest are clearly aligned with the rest of the shareolders.

In conclusion, I am convinced that riding coattails of an investor with such a flair can pay. Of course, nobody is infallible, but why not put all the chances on our side by “partenering” with someone who seems born to make money? If you had the choice between a self-made man like Wasilenkoff or a technocrat CEO who used his political skills to succeed (and his stock options to get rich), which one would you choose? As for me, the choice is already made!

For more info:

An article about the expansion of Fortress Paper

An article about Chad Wasilenkoff

An article of the Globe & Mail

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