Peter Kellogg - Market Maker, Trader, Financier & Entrepreneur

Mercer Internationals Largest Shareholder

We encountered Peter Kellogg when researching the pulp player Mercer International (MERC) of which he is the majority shareholder with 36.5% of the shares. This is part of a “major shareholder” portrait series – with the aim of getting to understand the people who are having the possibility to influence the outcome of deep value situations. This article look at Kellogg’s career mainly from a Mercer International perspective.

742 ON THE FORBES LIST. Peter Kellogg (83 years) is a New Jersey-based billionaire investor who made his initial wealth through leading his father’s firm, the brokerage house Spear, Leeds & Kellogg (SLK) from the 1980s to its 2000 sale to Goldman Sachs för $6.5bn. Today, according to Forbes, Kellogg has a net worth of $5.4bn. He runs his family office through IAT Reinsurance Co (IAT).

(AI picture from ChatGPT)

IAT REINSURANCE. Kellogg founded IAT in 1991 with $11.5m of equity. In 2023 (the latest we have found), book value was $1.4bn – a 17% CAGR since inception. As of 3Q25, IAT’s equity portfolio (according to their 13F – thus only US holdings) amounted to $475m over 85 holdings – the largest being Goldman Sachs (13%), Raymond James Financial (11%) and Mercer International (MERC) (10% & 16.7m shares). Through private holdings and other entities, he holds a further 7.8m shares in MERC – taking his total MERC holding to a value of $48m (currently depressed) and 36.5% of the shares.

INVESTS IN MERC AT THE SAME TIME AS EINHORN. MERC is a global producer of market pulp, lumber, and renewable energy with operations primarily in Canada, Germany, and the United States. The company supplies key materials to paper, packaging, and construction industries. Kellogg first crossed the 5% ownership threshold in 2003 (he likely had a smaller position since the late 90s). At that time, MERC was a much smaller company (sales around $190m compared to $1.9bn today) and was in the midst of a governance contest – David Einhorn’s Greenlight Capital (GC)had launched a proxy fight during the year, seeking board seats (GC first invested in MERC in 1997). That contest was resolved by August 2003 via a settlement in which Greenlight (15% of the shares) agreed to a consensual slate of board nominees. Kellogg was not publicly part of the Greenlight campaign - instead, he was quietly accumulating shares in the market.

THE ACCUMULATION PHASE. By 2004 he had surpassed the 10% mark. He kept a low profile – he did not seek a board seat or make public declarations of intent. By 2008 he had acquired over 20%. MERC was expanding its operations in that period – acquiring and green fielding major pulp mill assets in Germany and Canada. By 2008, MERC’s sales had almost quadrupled to $720m.

BECOMING THE LARGEST SHAREHOLDER. In March 2010, Kellogg filed an initial Schedule 13D (prior filings were the lighter 13Gs) with the SEC (quite late – since he passed the 20% threshold in 2008). In this and subsequent 13D amendments, Kellogg stated that his shares were acquired “for investment purposes” and not with the aim of changing or influencing control of the company. He did, however, reserve the right to buy more shares or engage in discussions with MERC’s management if circumstances warranted. By mid-2014, a filing showed Kellogg owning 27.6% of MERC’s shares. This was more than 3x the stake of the next-largest holder at that time. In September 2014, the SEC announced an enforcement action regarding Kellogg’s failure to timely file ownership reports (13Ds when he crossed 20%) in several stocks, MERC included. Kellogg settled the case, paying a civil penalty of c. $100k for the filing delays.

GRADUAL ACCUMULATION. Throughout the latter half of the 2010s, Kellogg’s name regularly appeared in MERC’s filings (Forms 4 and 13D amendments) reporting incremental buys. These transactions typically occurred when MERC’s stock price dipped. By 2024, Kellogg owned 33.9% of the shares. Kellogg still did not take a seat on MERC’s board, nor is there public evidence of him affecting company policy. The board composition in 2020 and onward featured independent directors and executives, and no one directly linked to Kellogg. In 2025, Kellogg bought another 1.9m shares during a period when MERC’s share price was under pressure – taking his holding to its peak level at 36.5%.

NAM TAI PROPERTY – ANOTHER DEEP VALUE NAME. Those that have been around the deep value world for +10 years are all likely familiar with the name Nam Tai Property (NTP). NTP is a property developer active in China, previously active as a manufacturer of electrical components (changed its name from Nam Tai Electronics in 2014). Kellogg invested and joined the board of NTP in 2000. He is still on the board and is currently the second largest shareholder with 19% ($48m).

KAISA’S TAKEOVER AND DECLINE. In 2017, the Chinese real estate conglomerate Kaisa Group acquired about 18% of Nam Tai at $17 per share - more than double the market price - and later increased its stake to around 25%, becoming the largest shareholder. Kaisa quickly took control by appointing the founder’s brother, as CEO and chairman, and filling most board seats with its affiliates. Between 2017 and 2020, the company’s performance and transparency deteriorated sharply: investor communication ceased, the share price collapsed to about $8, and minority shareholders grew alarmed by potential self-dealing and conflicts of interest. Kellogg remained on the board but was effectively sidelined. The tension would eventually erupt in 2020 through the IsZo-led activist campaign.

JOINS ACTIVISTS AFTER 20 YEARS ON THE BOARD. In 2020, Kellogg faced a defining moment after two decades on NTP’s board. That year, New York–based activist fund IsZo Capital (owning 10% of the shares) launched a campaign against the Kaisa Group – arguing that NTP’s leadership had mismanaged the company and failed to unlock its real estate value. Initially observing from the sidelines, Kellogg - who owned roughly 20% of the shares - decided in late summer 2020 to back IsZo’s call for an EGM aimed at removing the Kaisa-aligned board. His formal SEC filing in September confirmed his support, enabling activists to surpass the 30% threshold needed to convene the EGM and securing over 40% of votes. Although Kellogg did not commit to voting for all of IsZo’s proposed changes, his move was widely seen as a decisive signal against the incumbent leadership. Notably, the activists proposed to retain Kellogg and another long-serving independent director, recognizing them as credible and independent voices rather than part of the problem. Kellogg had, as we understand, never publicly engaged in activism before.

THE DILUTION BATTLE AND BVI COURT RULING. When Kellogg and other shareholders backed IsZo’s call for an EGM in late 2020, the Kaisa-controlled management retaliated with a controversial private placement. In October 2020, NTP issued 18.7m new shares at $9.15 each, mainly to Kaisa’s BVI subsidiary Greater Sail Ltd, raising its stake from about 24% to nearly 44%. IsZo, supported by Kellogg, responded by expanding its lawsuit in the British Virgin Islands - where NTP is incorporated - seeking to void the issuance. In March 2021, the BVI court ruled in favor of the activists, declaring the placement invalid and ordering the shareholder EGM to proceed. Kaisa appealed the ruling, and in the meantime, several Chinese banks froze Nam Tai’s accounts or demanded early repayment of loans, triggering a liquidity crisis.

OUTCOME AND AFTERMATH. The EGM was finally held on November 30, 2021, resulting in a decisive victory for the activists. Shareholders voted to remove all Kaisa-linked directors and replace them with nominees backed by IsZo and Oasis Management, while Kellogg and Mark Waslen retained their seats. The next day, the CEO was formally dismissed. The outcome marked the end of Kaisa’s control and a rare example of a successful activist victory over a Chinese conglomerate in an offshore-listed company. For Kellogg, it was the culmination of a four-year conflict - transforming him from a quiet board veteran into a pivotal ally of activist investors.

What is your view of Kellogg as an investor and what do you think he has in mind for his holding in Mercer International?

Disclaimer

This article is based solely on publicly available information, including SEC filings, company reports, and reputable financial data sources. It is intended for informational and educational purposes only and does not constitute investment advice or a recommendation to buy or sell any security. The author owns shares in Mercer International (MERC) as part of a diversified investment portfolio. All opinions and interpretations are the author’s own at the time of publication. Readers should conduct their own due diligence before making any investment decisions.