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.
Boston.com – Federal investigators plan to charge at least 10 securities professionals with insider trading, some linked to the criminal case against billionaire hedge fund manager Raj Rajaratnam that shook Wall Street last week, people familiar with the matter said yesterday.
The pending crackdown, more than two years in the making and among the biggest undercover operations into insider trading, may yield charges against hedge fund managers and their associates as early as this week, the people said, declining to be identified because the cases aren’t public. Authorities had planned to arrest Rajaratnam this week as part of a broader sweep, expediting it after learning he had bought a plane ticket to travel to London on Friday, one person said.
The Business Insider – We’re eagerly awaiting the testimony of energy fund billionaire John Arnold before the Commodity Futures Trading Commission today, and not just for the obvious reasons.
Former Enron trader Arnold presumably became the second-youngest self-made billionaire in the country in part by exploiting the same speculation spree that two years ago caused gas prices to triple while world oil demand was actually falling.
Bloomberg – K+S AG, Europe’s largest maker of potash for fertilizers, and competitor Israel Chemicals Ltd. fell in local trading after a Russian rival’s contract in India prompted speculation that prices will come under pressure.
The drop mirrors declines at North American producers Potash Corp. of Saskatchewan Inc. and Mosaic Co. on July 10 after RBC Capital Markets reported that Russian producer OAO Silvinit may have sold the crop nutrient for less than analysts expected. K+S lost as much as 5.4 percent and the Israeli company dropped 3 percent.
Soros Fund Management LLC, billionaire investor George Soros’s hedge fund firm, owns about 1.9 percent of Potash Corp after reducing the stake to 5.6 million shares at the end of the first quarter from 5.9 million at the beginning of the year.
Reuters – The worst of the global economic crisis is over, multi-billionaire financier George Soros told Polish news channel TVN24 on Sunday urging the creation of international regulations to oversee global markets.
"Decidedly the worst (of the crisis) is already behind us," said Soros, a 78-year-old Hungarian-born American with Jewish roots.
Bloomberg – Billionaire Nelson Peltz and former Countrywide Financial Corp. President Stanford Kurland are among at least six investors turning to the public markets to finance purchases of distressed home loans and corporate debt.
The investors, most of whom previously relied on private partnerships for funding, have proposed since May 1 to raise $2.6 billion through public stock sales. They plan to use the money, along with government financing in some cases, to acquire mortgages and below-investment grade loans to companies that fell in value amid the collapse of the real estate and credit markets starting in mid-2007.
Times Online – Hugh Osmond is sitting on a multimillion-pound paper loss after his Pearl Group life assurer agreed a deal to trim its £3 billion debt burden and bring in new equity investors.
Pearl secured a £500 million injection from Liberty Acquisition Holdings, a company controlled by two New York-based investors, one of whom is Nicolas Berggruen, a billionaire hedge fund investor with a personal wealth estimated at £1.8 billion, according to the Sunday Times Rich List. He is known in hedge fund circles as the “homeless billionaire” because he lives in hotels.
msnbc.com – He is hardly your average movie investor. He cultivates his privacy, and he heads a $13 billion hedge fund that, unlike those run by Carl Icahn and others, rarely mounts a proxy fight. But while most Hollywood bankers have turned off the money spigot, billionaire Paul Singer’s Elliott Associates appears to be stepping up its investments.
Last year the firm lent money to film investor Ryan Kavanaugh, who is providing financing for as much as 75% of Universal Studio’s films through 2011. In recent days movie moguls have been buzzing that the hedge fund could be eyeing a play for the debt-hobbled MGM studio by buying up a small piece of the iconic film company’s nearly $4 billion in debt.
St. George Daily Spectrum – According to the Center for Responsive Politics, hedge funds and private equity firms donated $2,992,456 to the Obama campaign in the 2008 cycle. Obama, vocal critic of the campaign finance practice known as "bundling," accepted more than $200,000 in bundled contributions from billionaire hedge-fund manager James Torrey, more than $100,000 in bundled contributions from billionaire hedge-fund manager Paul Tudor Jones and more than $50,000 in bundled contributions from billionaire hedge-fund manager Kenneth C. Griffin, chief executive officer of Citadel Investment Group in Chicago.
In an extraordinarily candid open letter to Obama, hedge-fund manager Cliff Asness defended his industry from the president’s "backwards and libelous" charges. "Managers have a fiduciary obligation to look after their clients’ money as best they can, not to support the president, nor to oppose him, nor otherwise advance their political views," Asness wrote. He has oversight of some $20 billion at AQR Capital Management, LLC, which is not involved in the Chrysler case.
First Post – Hopes are growing that the world has turned the corner, after a number of high profile figures made encouraging noises about the state of the global economy. Billionaire hedge fund manager George Soros said that "the economic freefall has been stopped" and "national economic stimulus programmes are starting to take effect".
His thoughts marked a change of heart, as he was negative on the markets last year. He expects Asia to recover first and the US shortly thereafter.
Wealth Bulletin – Satellite Asset Management, a $2.8bn (€2.1bn) hedge fund established by former employees of billionaire George Soros, is winding down due to investor redemptions, Bloomberg said on its website late Friday, according to a Reuters report.
The New York-based firm, which had nearly $7bn in client assets at the end of 2007, was launched in 1999 by Lief Rosenblatt, Gabe Nechamkin and Mark Sonnino, who worked together at Soros Fund Management.
Reuters India – Satellite Asset Management LP, a $2.8 billion (1.84 billion pounds) hedge fund founded by former employees of billionaire George Soros, is closing down because of client withdrawals, Bloomberg said on its website late Friday.
The New York-based firm has started returning money to investors from its three funds, Satellite Overseas Fund Ltd, Satellite Fund II LP and Satellite Credit Opportunities Ltd, the report said, citing a person familiar with the matter.
Bloomberg – Billionaire investor George Soros’s Soros Fund Management LLC was fined 489 million forint ($2.2 million) for attempting to manipulate the share price of OTP Bank Nyrt., Hungary’s largest bank, the country’s financial regulator said.
The Soros fund attempted on Oct. 9 to “send out false or misleading signals about a security’s supply and demand or its share price” and short sold OTP shares, the regulator, known as PSZAF, said in a statement late yesterday. The short selling caused the shares to drop 14 percent in the final 30 minutes of trade, the regulator said.
Short-sellers sell borrowed securities, hoping to profit by repurchasing them later at a lower price and then returning them to the owner. Budapest-based OTP is Hungary’s largest lender.
