Hedgies’ Greek bank trade sweet enough as it is 7 Oct 2013 Greece’s improving economy has prompted the likes of John Paulson to invest in the country’s banks. That should help return them to the private sector. But hedge funds don’t need an extra-sweet deal with lower strike prices on the warrants that came free with the banks’ recaps.
Ackman has Air Products catalyst, now for reaction 26 Sep 2013 The activist hedgie has dislodged the gas firm’s underperforming boss, John McGlade. That quick win brought him a sharp gain of about $100 mln on his 10 pct holding. For bigger, more lasting success, however, a painstaking transformation of the company is now needed.
Blackstone engineers an upgrade during Hilton stay 12 Sep 2013 The private equity firm is starting the checkout process with an IPO six years after its $27 bln buyout. At current industry values, Hilton would bring Blackstone an IRR of about 13.5 pct. That’s no five-star return but it’s quite a turnaround from how prospects once looked.
Carl Icahn won’t have the last tweet on Dell 9 Sep 2013 The billionaire has conceded defeat in his effort to block Michael Dell’s $24 bln buyout of the PC maker. Icahn may still profit, and his broader record is strong. But his Dell logic did not compute. And his recent punt on Apple is a better ad for his self-promoting parting shot.
Harbinger’s mea culpa vindicates judge’s chutzpah 19 Aug 2013 The hedge fund and its billionaire boss, Phil Falcone, admit wrongdoing in an $18 mln deal with the SEC. But credit goes to Jed Rakoff, the New York federal judge who has demanded harsher Wall Street penalties. The U.S. watchdog may have inflicted the bite, but he supplied the teeth.
Ivory tower barbarian now pounds at the gate 16 Aug 2013 A Harvard Law professor is ratcheting up his battle against corporate defenders such as Martin Lipton. Hedge fund bosses like Dan Loeb and Bill Ackman expose real management weaknesses. Even without their resources, academic activists like Lucian Bebchuk can still be on target.
Bill Ackman’s plate-spinning act gets dangerous 13 Aug 2013 The activist hedge fund boss is always ready for a fight – just maybe not so many at once. Ackman is embarking on a campaign at Air Products even amid high-profile tussles at P&G, Herbalife and beyond. Resigning from the J.C. Penney board is prudent for more reasons than one.
SAC’s Steve Cohen may be the A-Rod of Wall Street 6 Aug 2013 Like the Yankees slugger, the hedge fund boss faces sanctions for alleged use of an illegal “edge.” It’s unclear that either broke arguably fuzzy rules. And trying to level their respective playing fields may be futile. Ultimately, baseball and Wall Street are bigger than both.
EADS should play long game with Dassault stake 5 Aug 2013 Hedge fund TCI has done EADS a favour by calling on the aerospace group to sell its stake in French subsidiary Dassault Aviation - EADS already wants to exit non-strategic minority stakes. A market placing would be ideal. But if Paris meddles, no deal is better than a bad deal.
Flawed Dell compromise saves faces all round 2 Aug 2013 Letting the $24 bln buyout fade away would have hurt most shareholders, the board and the founder. But the PC maker’s worsening prospects left little room. A 2 pct hike in the offer price in return for a tweaked voting procedure won’t delight anyone but should seal the deal.
SAC charges challenge hedge fund model 26 Jul 2013 The U.S. government’s indictment suggests recruitment should focus on compliance over money-making ability, turns investment “edge” into a dirty word, and implicitly questions the “mosaic” technique of information-gathering. It’s a worry for Steve Cohen’s industry peers.
SAC staffers take the bullet meant for Cohen 25 Jul 2013 Unable to nail the billionaire hedge fund boss, the U.S. has charged his firm instead. SAC may be culpable, but the allegations largely involve actions years ago by ex-employees. That leaves current staff to suffer the fallout. There’s too much spite mixed in with the justice.
Dan Loeb’s Yahoo exit hurts investors twice over 22 Jul 2013 The Internet firm is buying back most of the hedge funder’s stake, held by Third Point, for $1.2 bln. That sucks up most of the cash Yahoo reserved for repurchases. It also heralds the departure of three Third Point-approved directors, robbing Yahoo of some much-needed advisers.
Steve Cohen case ends with whimper – as may SAC 19 Jul 2013 The SEC has accused the billionaire hedge fund boss of turning a blind eye to insider trades by two of his firm’s employees. A civil, rather than criminal, case isn’t much to show for a years-long probe. It may at least leave Cohen with his ego bruised, managing only his own money.
Higher volatility is the new normal in credit 10 Jul 2013 The end of Fed bond buying will remove a crutch that supported credit markets even as investment banks cut their trading inventory. Worse, it would come as credit ETFs are suffering outflows. Less liquid markets bring bigger price swings. For the smart money, it’s an opportunity.
Neat compromise may bridge fund manager pay divide 17 Jun 2013 Bonuses for fund managers may be capped under plans pushed in Brussels. Other performance fees may be outlawed too. One alternative approach would link bonuses and fees with strict multi-year results while deferring payments. The idea is clever, and might work.
Apollo may quadruple its money on oil start-up 11 Jun 2013 The buyout firm is taking Athlon public just three years after drilling $400 mln into it. With EBITDA set to double this year and possibly next, the oil explorer may be worth $2 bln. With such returns, it’s no wonder Apollo boss Leon Black wants to sell anything not nailed down.
Leave it to a hedgie to take on Einstein 7 Jun 2013 A brainiac hedge fund manager thinks he has cracked one of physics’ biggest mysteries. Scientists are sceptical, but admit Eric Weinstein’s ideas deserve study. Even if he is wrong, it’s nice for once to see a Wall Street boffin apply his skills to questions of beauty and truth.
Man Group needs to address stock volatility 5 Jun 2013 If hedge funds are meant to deliver uncorrelated returns, why is Man’s share price so unstable? The latest tumble comes after its main fund was blown off course. Perhaps more diversification would help. Otherwise, the ups and downs suggest Man is worth more in private hands.
Breakup looks timely for Kleinwort Benson owner 28 May 2013 Activists have found a vulnerable target in RHJ. A previous attempt to unlock the value of its esteemed Kleinwort private bank failed. But RHJ’s stubborn share price weakness, combined with its ill-judged bid for Germany’s BHF, gives the latest assault more chance of success.