Argentina’s Macri puts money where his mouth is 8 Feb 2016 The president offered holdout creditors a 25 pct discount on $9 bln of defaulted debt. Two agreed. Hedge fund Elliott is holding out; Argentina’s Congress and a U.S. judge must OK any deal. But a functional economy and access to global markets may finally be in reach.
Ackman inadvertently makes case for index funds 27 Jan 2016 The Pershing Square boss rails against passive portfolio managers in his latest missive. Bill Ackman also blames his own woeful 2015 performance on bad market timing and hedges that didn’t work. That encapsulates why most investors should stick to the likes of the S&P 500.
Even hedgies have (Tudor) Joneses to keep up with 27 Jan 2016 An annual ranking of the 20 most profitable hedge-fund managers ever, including Ray Dalio and George Soros – but this time excluding Bill Ackman – suggests they have made almost as much as the rest combined. Would-be investors take note: The 0.1 pct have their own 0.1 pct.
Soros aura brings rare $4.5 bln hedge-fund startup 5 Jan 2016 Scott Bessent, the famed investor’s ex-CIO, has raised one of the biggest totals ever for his firm, Key Square. That’s remarkable in an era of subpar hedgie returns, even if $2 bln comes from Bessent’s former boss. It’s also evidence of the lasting power of industry pioneers.
Argentina and Elliott give peace a chance in 2016 21 Dec 2015 There may never be a better time for Latin America’s No. 3 economy and the hedge fund to end a 14-year spat over defaulted bonds. New President Macri needs access to global debt markets; another defiant Peronist could succeed him if he fails. Stalemate is looking pointless.
Pharma CEO’s arrest a sign of health sector ills 17 Dec 2015 Turing’s Martin Shkreli may face fraud charges. That’s not unheard of in an industry prone to financial foibles, but its recent boom offers more chances for misconduct. With good times fading, the excesses stand out like a sore thumb. Pharma’s bad boy is an obvious first target.
Pimco has chosen the wrong celebrity advisers 8 Dec 2015 The $1.5 trln asset manager’s new advisory board includes former UK premier Gordon Brown and ex-Fed Chair Ben Bernanke. Their past errors are worth learning from. But people who spotted trouble coming, such as Raghuram Rajan, India’s central bank chief, would serve Pimco better.
"Zero and 100" model might just work for BlueCrest 7 Dec 2015 The $8 bln hedge fund is closing to outsiders. Michael Platt’s firm will need to do more with far less capital to offset the loss of hefty “2 and 20” external fees. A Breakingviews analysis shows higher leverage is the key. Platt may be OK taking extra risk others wouldn’t.
Ackman’s Valeant defense nervy but unpersuasive 30 Oct 2015 The hedge fund founder says the drug firm is a victim of bad PR, naive investors and jealous rivals. He even likened his stake to Warren Buffett’s savvy investment in lenders cheated by a 1960s salad-oil scandal. The reality is Valeant is flawed in ways a “pep talk” won’t fix.
After Cristina, a more investor-friendly Argentina 23 Oct 2015 No matter who emerges victorious in Sunday’s vote, Latin America’s third-biggest economy will end up more welcoming to investors than under President Fernandez. That’s not saying much. Front-runner Scioli offers a gradual fix for the nation’s woes, but may need to move faster.
Valeant sets tone for post-M&A accounting scrutiny 22 Oct 2015 The drugmaker’s stock ended Wednesday down 19 pct after a short-seller and others questioned its bookkeeping. The $40 bln serial acquirer’s history may make it an obvious target, but as growth and mergers slow a renewed investor focus on companies’ figures is a logical shift.
GE is overdue Nelson Peltz’s kid-glove activism 5 Oct 2015 His investment firm now owns 1 pct of the slimmed-down $266 bln U.S. conglomerate. But the usually forceful activist is playing nice. That’s because CEO Jeff Immelt’s plan to ditch most of GE’s finance unit should work. Any fumbling, though, will create an easy target for Peltz.
KKR and Marshall Wace marry need with ambition 9 Sep 2015 The buyout shop’s purchase of 25 pct of Marshall Wace creates an odd beast: KKR doesn’t get control, and the precedents are mixed. Still, asset managers want scale and diversity, and the buyout business is challenged. If the tensions can be managed, it looks a logical trade.
Hedge fund wobbles hand ammunition to fee fighters 1 Sep 2015 Big names from Greenlight to Pershing to Third Point have taken a pounding from recent market turmoil. It’s just a month’s bad performance. But if high-priced managers can’t provide a hedge to regular investments, it lends extra weight to Calpers and others who are ditching them.
Carlyle hedge fund speed bumps morph into sinkhole 18 Aug 2015 Claren Road lost money on Fannie and Freddie, energy and Greece. That doesn’t explain how assets tumbled from more than $8 bln to potentially $2 bln in a year. The saga shows how a scatter of small doubts can quickly erase a solid record – even amidst unthreatening broader markets.
Humpty Dumpty M&A sings song of excess 6 Aug 2015 Bill Ackman has taken a stake in the $75 bln Mondelez, seemingly predicated on the possibility of putting it back together again with Kraft. Meantime there’s talk of successful tech spinoff VMware absorbing its parent EMC. It’s fantasy season for all the Street’s men.
Travel deal treads new path for shell companies 16 Jul 2015 Blank-check vehicles have often brought financial misadventure. The latest quest for success is the acquisition of Lindblad, a National Geographic-linked operator of cruises to the Galapagos and Antarctica. New terms and investors suggest so-called SPACs are worth revisiting.
Macy’s will struggle to resist real estate sale 15 Jul 2015 Activist fund Starboard has bought into the $23 bln U.S. department store chain, earmarking the company’s property holdings as a source of value. Spinning off buildings is a hot trend, and the numbers add up for Macy’s. The long-term risks, though, shouldn’t be discounted.
May Paulson’s Harvard gift spark plutocrat rivalry 3 Jun 2015 The hedgie’s $400 mln donation could soon be surpassed as the university’s largest, if recent history is any guide. Others like Bill Gates give more creatively, but engineering education is hardly a bad choice. Inflation – and competition – are welcome in the charitable context.
Hedgies’ Safeway victory puts boards on notice 2 Jun 2015 Cerberus-owned Albertsons has to give three investors 27 pct more than it paid for its rival. The speedy resolution of this appraisal rights case should embolden those suing Safeway’s board for failing to get the best deal – and remind directors that their necks are on the line.