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Struggling General Growth Properties Inc. rallied Tuesday after disclosing an investment from hedge fund manager Pershing Square Capital Management LP. General Growth stock nearly doubled in morning trading.
New York-based Pershing Square Capital bought 20.1 million shares of General Growth Properties stock this month, giving it a 7.5 percent stake in the company. It also has options on an additional 33.4 million shares for a total of a nearly 20 percent stake.
Chicago-based General Growth Properties reported a $15.4 million loss for its latest quarter. It has suspended its shareholder dividend and halted plans for new development. The company, facing a looming deadline for maturing
Bizjournals.com – Struggling General Growth Properties Inc., owner of the St. Louis Galleria and 200 malls nationwide, rallied Tuesday after disclosing an investment from hedge fund manager Pershing Square Capital Management LP.
General Growth stock nearly doubled in morning trading.
New York-based Pershing Square Capital bought 20.1 million shares of General Growth Properties stock this month, giving it a 7.5 percent stake in the company. It also has options on an additional 33.4 million shares for a total of a nearly 20 percent stake.
A posh part of London or New York can be suitable, as in Pershing Square Capital, Cheyne Capital and Thames River Capital.
Or you could choose something slightly aggressive such as Tiger Capital, Citadel Capital or Centaurus. Among the big financial firms, it is voguish to squeeze as many meaningless words as possible into the title of a hedge fund. Length is not a sign of quality, however; a Bear Stearns hedge fund which went from $642m to zero was called the "high-grade structured credit strategies enhanced leverage fund".
2 Get a brass plaque in the Cayman Islands
Nearly all hedge funds are legally registered in tax havens to avoid both the taxman and to skirt regulatory hurdles – the sunny climes of the Caymans and Bermuda are particularly popular. Theoretically, a fund registered in London would have to register with the Financial Services Authority, but this has never actually happened. An FSA spokeswoman says: "Nobody ever registers hedge funds in the UK. If somebody did, we’d be scratching our heads over how to deal with it. We’d have to devise something."
3 Set your fees
The real fun starts here. Hedge funds are enormously lucrative – their standard fee arrangement is "two and 20". This means that as a fund manager, you can take 2% of clients’ money up front before you do anything, then keep 20% of any appreciation on the value of your fund. For successful hedgies, that means a phenomenal payday. For example, if a fund raises $1bn from investors and achieves a 30% rise in value over a year, the fund’s management earns $78.8m. Crispin Odey – one of London’s leading hedge fund managers – has just paid himself £28m after his firm successfully negotiated the credit crunch to make more than £55m profit in the past financial year. Most of the remaining £27m will be shared among Odey Asset Management’s 11 other partners. The fund manages around £2.7bn of assets.
Bloomberg- William Ackman, the activist hedge fund manager, increased his $2 billion bet on Target Corp. as shares of the second-largest U.S. discount retailer declined as much as 38 percent in the past year, according to two people with knowledge of the matter.
Pershing Square Capital Management LP, Ackman’s New York- based firm, added at least $100 million to the hedge fund it started last year to invest in Target. Ackman personally committed $5 million and solicited money from current and new investors, said the people, who declined to be identified because the fund is private.
Bloomberg- William Ackman put more cash into the $2 billion hedge fund he started to invest in Target Corp. as shares of the second-largest U.S. discount retailer declined 38 percent in the past year, according to two people with knowledge of the matter.
Pershing Square Capital Management LP, Ackman’s New York- based firm, added at least $100 million to the fund, while he personally committed $5 million. Ackman also solicited money from current and new investors, said the people, who declined to be identified because the fund is private.
The Target fund’s loss may exceed the drop in the Minneapolis-based company’s stock because it uses derivatives, which can amplify gains and losses. Target peaked at a record $70.14 on July 13, 2007, three days before Ackman disclosed owning a stake. Earnings have fallen for three straight quarters as consumers cut back on purchases of clothing and home goods.
