Each business day HedgeCo.Net keeps you informed with the top hedge fund industry news, opinion and insight from around the globe. From the latest hedge fund launches, to the impact of regulation, competition, and investor activism - we track the topics and people that make a difference to you.
Alibaba News Channel – European companies emerging from the credit crisis should start looking over their shoulders: activist investors are set to return from hibernation, working more closely than ever with institutions to effect change.
The activists, who favour methods such as changing balance sheet structures, ousting chairmen or selling off non-core units, had little to do during the crisis when buyers were scarce and there was little appetite for transformatory change. But now they are set to gain from a political will to drive large institutional investors towards more active investment and away from a mentality of simply selling stocks they don’t like, while a purge of more leveraged, short-termist funds has cleared the ground for activists to tap a wealth of new opportunities.
"Pushed and shoved by the regulators, mainstream institutions are beginning to countenance interaction with activist investors," said a senior figure at one activist firm.
Guardian.co.uk – Big gains on derivative bets linked to Volkswagen shares offset a decline in nine-month earnings at Porsche SE’s core sports car business, the heavily indebted holding company said on Friday.
Porsche, scrambling to shore up its tattered balance sheet, blamed lower volumes and revenue as well as investments on its upcoming fourth model line and hybrid powertrain technology but insisted that its returns remained relatively healthy.
"A high earnings margin was still achieved," the company said in a statement, while a company spokesman added that it was "nearly in the double-digits".
That is still a drop from Porsche’s traditional margins of near 20 percent when markets were strong.
New York Times Blogs – E*Trade Financial is in talks with Citadel Investment Group, the hedge fund that is its largest shareholder, about a deal to shore up the struggling brokerage firm’s balance sheet, The Wall Street Journal reported, citing people familiar with the matter.
The two companies have been in negotiations for weeks to find a solution to E*Trade’s financial problems, The Journal said, adding that terms of the deal were unknown.
On Tuesday, E*Trade announced that Citadel Chief Executive Kenneth C. Griffin would be joining the firm’s finance and risk-oversight committee.
West Palm Beach (HedgeCo.net) – Hedge fund manager Integrated Asset Management plc has sold the majority of one of its London fund of hedge funds business to a subsidiary of Sal. Oppenheim jr & Cie S.C.A, for approximately €3.5 million ($4.6 million) in cash and the cancellation of Sal. Oppenheim’s entire share interest.
The transaction does not impact the hedge fund manager’s brokerage operations in Milan which will continue to operate as usual, Integrated said.
The fund of hedge funds business as a whole reported net assets of £24.28 million ($32.3 million). In the 6 months ended 30 June 2008 the fund of hedge funds business reported unaudited net assets of £24.42 million ($32.4 million) and assets under management of $2,402 million ($3.2 million).
“In response to the unprecedentedly challenging market conditions of the past nine months, we have structured this deal with Sal. Oppenheim to benefit both our funds’ investors and the Company’s shareholders." Emanuel Arbib, CEO of Integrated, said. "Once the transaction is completed, Integrated, with a strong and liquid balance sheet, will be well positioned to consider opportunities that are available in today’s marketplace.”
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ShareCast – Private equity group BlueGem is to take a 40% stake in stockbroker Panmure Gordon in a move that will inject £17.3m of capital into the broker.Panmure Gordon has placed 72m new shares with BlueGem at 24p per share.
The acquisition of the stake represents BlueGem’s fourth investment and its first in the financial services sector. The company was formed in late 2006 by experienced investment bankers and fund managers to make investments in mid-market companies, predominantly in the UK and Italy.
The net proceeds from the placing will ‘significantly strengthen the company’s balance sheet’, the company said, giving it regulatory assets in excess of £40m, more than three times more than its required regulatory capital.
MSN MoneyCentral – Mace Security International Inc. said Tuesday it has only received $1 million of a little more than $3.2 million owed it by a hedge fund managed by missing Florida money manager Arthur Nadel.
The Horsham, Pa., maker of personal defense and electronic security products said the Victory Fund Ltd. didn’t pay Mace the roughly $2.2 million it was due Jan. 15.
“We have already filed a report with the authorities, and we intend to take all possible legal action against the Victory Fund,” Dennis Raefield, Mace’s CEO and president, said in a statement. “Mace continues to have a solid balance sheet, cash in the bank and strong business fundamentals.”
