Google’s Schmidt again plays adult in DE Shaw buy 24 Apr 2015 The tech giant’s executive chairman is taking 20 pct of the hedge fund firm off bankrupt Lehman Brothers’ hands. The billionaire was brought into Google to supervise its young founders. Not for him the frivolity of, say, a sports team investment like Steve Ballmer’s.
Qualcomm activist spat a lesson for Silicon Valley 13 Apr 2015 Jana Partners wants the $114 bln chip maker to consider a breakup and reform its board. Hiding behind dual-class stocks, as some tech rivals do, may limit such meddling. But it wouldn’t fix Qualcomm’s problem of a sleepy board and entrenched management running it below potential.
New York strikes fresh blow for boring investments 9 Apr 2015 The city’s comptroller is upset by the fees its $160 bln of pension funds pay Wall Street. Active stock and bond managers end up essentially no better than index benchmarks. But it’s private equity and other off-market investments that seem to cost much more than they’re worth.
Activism is lost in translation at Vivendi 23 Mar 2015 The French media group is the object of a transatlantic clash between U.S. investor Peter Schoenfeld and group chairman Vincent Bollore. Vivendi could indeed be more shareholder-friendly. But Schoenfeld may struggle to win large institutional support in Paris.
BNY Mellon spat hints at activism getting crowded 13 Mar 2015 Marcato Capital, run by a protégé of Bill Ackman, is gunning for the bank’s CEO after Nelson Peltz’s Trian secured a board seat. Sotheby’s and Darden also attracted multiple agitators. Being pushy has been profitable, but there may be too much money chasing too few opportunities.
Edward Hadas: The big question for asset managers 12 Mar 2015 The obvious question for fund professionals is why they earn so much: pay could soon overtake that at investment banks. The easy answer is because they can. The larger issue is what are they doing? Most strive to outperform on secondary markets. That does the economy no good.
Computer Sciences LBO talk rings unhappy bells 25 Feb 2015 Activist investor Jana and the $10 bln IT services firm’s bosses have incentives to sell. But past attempts to find a buyer for the company have foundered. Declining sales and vulnerable cash flow make it a tricky buyout candidate. Splitting it up may be a better first step.
Fresh flames rise from Sealy’s ever-burning bed 17 Feb 2015 Uppity investor H Partners, alleging serial underperformance and stale private equity directors, wants Tempur Sealy’s CEO fired and a seat on the board. The company and the mattress industry have a torturous financial history. It probably means where there’s smoke, there’s fire.
Proxy fight as much about Peltz’s Trian as DuPont 9 Jan 2015 The billionaire activist is seeking four board seats at the chemicals group, his first public contest since Heinz nine years ago. Flexing muscle sends a message to other stubborn targets, like Pepsi. It also gives younger staff at Trian Partners experience in the trenches.
Overreaching enforcers redraw insider trading line 10 Dec 2014 A U.S. court tossed convictions of two hedge fund managers, sharply narrowing the law on improper dealings. Prosecutors should expect more embarrassing reversals. The silver lining is that the ruling gives Wall Street clarity on what’s forbidden and should curb government excesses.
Steve Cohen’s loot could land in undeserving hands 11 Nov 2014 A $600 mln insider trading settlement with his SAC hedge fund will probably go to investors on the other side of its dodgy deals. Better them than Uncle Sam. But the real victims were drug firms whose data SAC’s trader stole. U.S. watchdogs miss the mark in allotting fine proceeds.
Divorcing oil baron braves market decoupling 6 Nov 2014 Billionaire Harold Hamm’s $14 bln fortune hangs in the balance of a spousal court battle. He is now scrapping hedges for his Continental Resources, betting on a reversal in the price of crude. Marital rifts can hurt investors, but in this case the business risk looks calculated.
Amgen boss makes a prime breakup target 21 Oct 2014 Former Morgan Stanley banker Robert Bradway runs the $109 bln biotech being eyed by activist Dan Loeb. Splitting into a cash cow and a growth arm comes up often in the industry but rarely happens. In Amgen’s case, its drug focus and the CEO’s background give the idea a chance.
Hedge fund boss serves up arbitrage opportunity 13 Oct 2014 Shares of Bill Ackman’s new $6 bln fund fell 12 pct on their debut. Weak markets aren’t helping, but the result also leaves the Pershing Square vehicle trading at a 10 pct discount to net asset value. Exploiting the valuation gap is a better bet than trying to shake up companies.
Ackman bridges gap in race against Loeb 22 Sep 2014 A new $5 bln Amsterdam-listed fund from the Pershing Square founder should dust one in London run by his Third Point nemesis. Ackman’s lower fees and ease of valuation offset questions over governance and discount controls. The hedgie peloton has a new leader to follow.
Hedge-fund-free – the latest Californian fad? 16 Sep 2014 Calpers, the $300 bln pension manager, is offloading its $4 bln of hedge funds. Too many in the 2-and-20 crowd look like stock pickers yet still present liquidity risks and, lately, low returns. Endowments are different, but for retirement funds Calpers could be setting a trend.
U.S. insider trading cops pick a bad time to lose 9 Jul 2014 The acquittal of Raj Rajaratnam’s brother comes as the nation’s lawmakers thumb their noses at an SEC probe of their trades. The cases are unrelated, but appearances matter on Capitol Hill. If watchdogs look like they’re overreaching, they can expect more pushback from Congress.
Value puzzle impedes hedge fund founder’s divorce 20 Jun 2014 Chris Hohn’s TCI holding would be worth much less if the fund firm had to be liquidated or split up as part of his marriage’s breakup. For value maximisation, the couple should share ownership. But that requires more goodwill than can usually be mustered in such circumstances.
Man Group gives hedgies best of both worlds 19 Jun 2014 The hedge fund firm will pay up to $494 mln for Numeric, its second asset manager purchase in as many weeks. The deal addresses Man’s weak U.S. position. The target’s managers get a stable home within a big listed group. They also get autonomy and a good cut of future profit.
Henry Kravis cultivates private equity perennials 29 May 2014 U.S. firms like his are selling companies to each other at a record pace. Such deals are dubious, especially given how much capital is stockpiled. But KKR’s $1.6 bln buyout of landscaper Brickman and quick merger with rival ValleyCrest suggest the grass can indeed be greener.