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.
HedgeCo.net (West Palm Beach) – Hedge fund law firm Conyers Dill & Pearman was named Offshore Law Firm of the Year at 2009 The Lawyer Awards. According to the judges’ criteria, the award is presented to the firm which demonstrates superior strategic clarity, growth of market share, technical legal excellence and quality of service. Conyers fulfilled each of those categories and the firm was commended for an “outstanding year”.
Christopher Johnson-Gilbert, managing partner of Conyers’ London office, collected the award at the ceremony which was held at Grosvenor House and attended by over 1000 lawyers. Johnson-Gilbert commented: “We are delighted to receive this award, which reflects the hard work of everyone across the firm over the past year in providing the highest quality legal advice on the leading offshore jurisdictions of the Cayman Islands, British Virgin Islands, Bermuda and Mauritius. Our strategic purpose and our balanced business model have seen continued success even in times of global difficulties.”
The past year has been one of significant expansion for Conyers during which it has advised on a number of high profile deals, consolidated its position in relation to the BRIC markets with new offices in Moscow and São Paolo, and the addition of a Mauritius office and a global Mauritius practice. Conyers has also gained market share in the Cayman Islands and British Virgin Islands, and maintained its dominance in the Bermuda market. Conyers continues to expand with new hires, and now numbers nearly 600 staff with over 150 lawyers located in 11 offices worldwide.
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Financial Standard – US-based hedge fund BlueMountain Capital Management hopes its forecast 20 per cent plus returns, lower fees and new liquidity rules will appeal to local super funds allocating new money into alternative strategies.
Hedge funds are a hard sell these days following the sector’s nightmare run in the past two years. But if there is a silver lining to the market carnage, it is that the hedge funds that did survive adopted their business model to a new norm.
New York (HedgeCo.Net) – The Obama administration is considering a deal in which they would forgive part of the $13.4 billion owed to them from General Motors Corp. in exchange for an equity stake in the company, according to a report by Bloomberg News who citing people familiar with the matter.
The deal comes as GM approaches their June 1 deadline to show they can become viable, the sources said.
GM is already considering breaking up the company into a sector comprised of only the profitable parts, such as Chevrolet and Cadillac, while the non-profitable entities, such as Hummer, can be liquidated.
GM still has major debt obligations to its bondholders, who are owed about $27.5 billion. The company also owes its health care fund about $20 billion. Retirees who are entitled to health care benefits would most likely get more equity in the new entity than the bondholders.
Bondholders previously opposed a plan by GM that would give them 90 percent equity in the newly restructured company, though that would have required them to swap most of their stake at the time.
President Obama has been vocal in his belief that bankruptcy is the best option for GM, though new CEO Fritz Henderson is doing everything he can to avoid that scenario. GM continues to work with the U.S. Treasury and the Obama administration in hopes of achieving a new, reorganized business model.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
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MSN Money UK – Northern Rock was the darling of the UK mortgage sector, but fuelled its rapid growth by borrowing in money markets and selling on its mortgage debts rather than customer deposits.
The eruption of the credit crunch in August 2007 as banks clamped down on risks shattered its business model and forced it to seek emergency aid from the Bank of England.
New York (HedgeCo.Net) – At least David Findel can never be called a band-wagon fan. The owner of mortgage-lender Financial Resources just agreed to pay a record $400,000 to the rights to two of the best seats at the new Meadowlands stadium. That’s just for the rights. The tickets themselves will cost him another $7000 annually.
The New Jersey native told the New York Post that he probably won’t even use the coveted seats.
“I purchased them for my son, Brandon, 11, and my daughter, Brooke, 7. I will probably continue to sit in my current seats.”
Both Jets and Giants fans were informed this season that they would have to pay money to obtain licenses in order to secure seats in the new stadium, which they will be sharing. Though some fans were outraged, the Jets were hoping to raise $170 million by selling licenses that ranged between $4000 and $25,000 per seat. The Giants, coming off a SuperBowl win and leading the solid NFC East Division, planned to charge between $1000 and $20,000 per seat license. The money from both teams will help to pay for the $1.3 billion in construction costs for the new stadium.
Jets owner Woody Johnson doesn’t see anything wrong with charging such outlandish fees in times of economic turmoil.
"People who buy PSLs and suites are looking over the long term," he said. "I know they realize, because I’ve been talking to a lot of them, that this is kind of a once-in-a-lifetime opportunity to buy something that hasn’t been available ever."
Meadowlands Stadium will hold 82,500 seats, making it the second largest stadium in the NFL next to FedEx Field, home of the Redskins.
Findel won the rights at an October 16 auction, outbidding other millionaires like Nobu owner Drew Nieporent. Instead of slightly raising the $140,000 bid for each of the two seats, he shocked the crowd and shot right up to $200,000 per seat. Not exactly the kind of frivolous purchase you see mortgage lenders making lately.
“Although part of the mortgage business is in turmoil, this is an opportunity to invest in my business and to further demonstrate our loyalty to the New York Jets,” Findel told the Post.
Ummm…a Favre jersey would’ve worked too.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
San Francisco Chronicle- The giant housing rescue plan President Bush signed Wednesday might help stanch the bleeding in the housing market, but experts on both sides of the political divide worry that it is, at best, only an emergency step.
In addition to $300 billion in government guarantees to aid homeowners threatened by foreclosure, the administration got extraordinary new powers to backstop mortgage giants Fannie Mae and Freddie Mac after their stocks plunged earlier this month. The legislation gives both companies an open line of credit at the U.S. Treasury and allows the government to buy the companies’ stock through 2009. In return, the companies get a tough new regulator.
But both firms remain weird hybrid entities whose profits are private but whose losses are public, a recipe for excessive risk-taking. The new law makes the government guarantee explicit, exposing taxpayers to losses that could dwarf the savings & loan bailouts of the 1980s that cost taxpayers $300 billion in today’s dollars.
The Australian- The SEC’s decision to take a hard line on the illegal practice of naked short-selling is a band-aid attempt to fix a problem that is plaguing most stock markets in various guises, but at least it is having a go.
The order lasts 30 days and covers 19 stocks, including the Wall Street jockeys Merrill Lynch, Lehman Brothers and troubled mortgage giants Fannie Mae and Freddie Mac.
In sharp contrast, the Australian Government has dragged its heels on short-selling abuses and isn’t expected to make any announcements until the second quarter of the year.
Meanwhile, stocks are being bludgeoned on the ASX as hedge funds borrow stocks from our super funds to attack companies. They are doing it with ease because there is little buyer support in the market, little transparency on covered short-selling, no capital gains tax and small fees charged on share lending.
