Before the California wildfires started last November, billionaire hedge fund manager Seth Klarman’s firm Baupost Group bought 14.5 million shares of PG&E stock, according to an article in Chief Investment Officer, then hedged its bet by purchasing insurance claims against the power company.

Baupost’s stake in the power company, worth about $49 a share before the fires started, fell to near $8 in January as a result of the utility’s bankruptcy filing (in the wake of admitting responsibility for the most destructive wildfire in California’s history). But the article explains that Klarman also purchased $1 billion in insurance claims against the utility (for up to 35 cents on the dollar) in connection with 2017 wildfires. The practice, known as subrogation, is a specialty for Klarman.

According to the article, it’s unclear whether Baupost has since sold any PG&E shares. It notes, however, that the firm reported a 2.8% gain for the year as of last November, a standout in its peer group—data from Hedge Fund Research showed that global hedge funds lost 0.1% for the period.

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