John Malone Gets $325 Million Boost After Archegos-Fueled Drop

Simon Hunt, Bloomberg News

SUN VALLEY, ID - JULY 7: John Malone, businessman and former chief executive of Tele-Communications Inc., attends the annual Allen & Company Sun Valley Conference, July 7, 2016 in Sun Valley, Idaho. Every July, some of the world's most wealthy and powerful businesspeople from the media, finance, technology and political spheres converge at the Sun Valley Resort for the exclusive weeklong conference. (Photo by Drew Angerer/Getty Images) , Photographer: Drew Angerer/Getty Images North America

(Bloomberg) -- Billionaire John Malone added about $325 million to his wealth Wednesday after Discovery Inc.’s class B shares soared in the aftermath of the stock selloff by Archegos Capital Management.

Discovery’s A shares were among the major positions liquidated by Archegos on Friday, causing the media company’s stock to drop 27%. The firm’s lightly traded B shares, almost all of which are owned by Malone, typically mirror the A-share price but have since diverged. They climbed as much as 115% and were trading at $124 a share at 2:51 p.m. in New York.

Read more: A Glossary to Understand the Collapse of Archegos: QuickTake

Wednesday’s jump in price was possibly the result of an “arb squeeze,” in which arbitrage traders turned to B shares after being unable to borrow against A shares, according to Dennis Dick, head of markets structure at Bright Trading.

“Just because the share classes are fundamentally linked, that doesn’t necessarily mean they will trade alike,” Dick said.

Malone, 80, is chairman of telecommunications firm Liberty Global Plc and is the largest private landowner in the U.S. with more than 2 million acres. He has a net worth of $8.9 billion, according to the Bloomberg Billionaires Index.

He owns about 94% of Discovery B shares, based on the company’s 2020 proxy statement. The stake was worth about $427 million as of Tuesday’s close.