Own Soul Patts shares? Here’s how much of its portfolio is exposed to coal

Is Soul Patts heavily invested in coal shares?

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Key points

  • Soul Patts is one of the ASX's oldest shares 
  • It owns a wide portfolio of ASX-listed shares 
  • But it also owns a big chunk of coal miner New Hope... 

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) is one of the oldest shares on the ASX. In fact, Soul Patts shares, with origins in the pre-Federation 19th century, predates the ASX itself.

The company initially grew out of a pharmacy. But these days, Soul Patts is well-known for its Listed Investment Company-like approach to managing its shareholders’ wealth. The company functions more like a Listed investment Company these days than a traditional company.

Its primary business is investing in a large portfolio of assets on behalf of its investors. Most of these assets are ASX-listed shares, in which Soul Patts has amassed large stakes in.

Many of these holdings aren’t controversial. They include (as of the March half-year update) the company’s 43.3% stake in Brickworks Limited (ASX: BKW), the 12.6% share of TPG Telecom Ltd (ASX: TPG) and the 25.4% chunk of Tuas Ltd (ASX: TUA).

Soul Patts or Coal Patts? Here’s what the company owns in coal…

But this hasn’t come without some consternation from some investors. For another of Soul Patts’ significant holdings is a 39.9% stake in ASX 200 coal miner New Hope Corporation Limited (ASX: NHC). New Hope is a pureplay coal miner, which of course makes it a controversial asset to hold for any investment manager in today’s climate.

So how much of Soul Patts’ portfolio is exposed to coal miner New Hope?

Well, as of 31 January 2022, Soul Patts had a net asset value of $9.042 billion. That’s including its multiple share portfolios, as well as its property assets.

Of this, $9.042 billion, $4.125 billion is housed in the company’s strategic portfolio. This is made up of the stakes in the companies listed above, but excludes the large-cap shares Soul Patts acquired from its acquisition of Milton Corporation last year.

So on today’s pricing, New Hope has a market capitalisation of $3.03 billion. Soul Patts’ 39.9% stake in this company means it would have approximately $1.21 billion worth of New Hope shares right now.

That would equate to 13.37% of Soul Patts’ entire investment portfolio (on the 31 January numbers), and just over 14% of Soul Patts’ entire market capitalisation today.

So that’s something to keep in mind if you own Soul Patts shares today.

Motley Fool contributor Sebastian Bowen has positions in Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended TPG Telecom Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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