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.
Bloomberg – Volkswagen AG has seen a doubling of short interest in its stock by hedge funds since the middle of last month, with 2 percent of the company’s shares, and almost a third of the common stock available for borrowing, out on loan, the Wall Street Journal reported, citing Dataexplorers, a firm of analysts.
West Palm Beach (HedgeCo.net) – Real estate services company, CB Richard Ellis Group, Inc. has reached an agreement to sell in a direct placement 13,440,860 shares of its Class A common stock for gross proceeds of approximately $100.0 million, to hedge fund manager Paulson & Co. Inc. on behalf of several of its investment funds and accounts it manages.
In addition, Ellis plans to sell Class A common stock, having an aggregate offering price of up to $50.0 million through J.P. Morgan.
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Reuters – Bill Ackman, founder of the Pershing Square hedge fund, has joined the board of bankrupt shopping mall operator General Growth Properties Inc, where he is a large shareholder.
Ackman is the founder and managing member of the general partner of Pershing Square Capital Management L.P. Pershing and its affiliates own slightly less than 7.5 percent of General Growth’s outstanding common stock, the company said late on Friday.
Ackman has said he could gain 13 times his investment in the company once it is reorganized, calling General Growth "high quality."
West Palm Beach (HedgeCo.Net) – Hedge fund GLG Partners has completed its private offering of $214 million aggregate of dollar-denominated convertible subordinated notes due 2014.
The notes bear interest at a rate of 5.00% per year and rank junior in right of payment to all of GLG’s existing and future senior indebtedness.
Noam Gottesman, chairman and co-CEO of GLG, Emmanuel Roman, co-CEO, and Pierre Lagrange, senior managing director of GLG Partners L.P. — each a director of GLG — purchased collectively $30 million of the notes from the initial purchasers as part of this offering, through certain of their affiliates.
The notes are convertible, at the option of the holder, into shares of GLG’s common stock at an initial conversion rate of 268.8172 shares per $1,000 principal amount of notes, subject to certain adjustments. The initial conversion rate is equivalent to a conversion price of around $3.72 per share.
GLG used a portion of the net proceeds from the offering of the notes to acquire a portion of the indebtedness outstanding under its credit agreement in a transaction that closed concurrently with the closing of the note offering. Around $285 million of $570 million principal amount of loans outstanding under the credit facility were acquired at 60% of par value.
The company said that any proceeds not used to acquire its outstanding indebtedness will be used by GLG for general corporate purposes to the extent permitted under the credit agreement.
New York-based GLG Partners is a hedge fund manager that manages equity and fixed income portfolios and investment funds. The firm also invests in public equity fixed income, and in alternative markets through options, futures and convertibles.
Boston Business Journal – Just days after winning regulatory approval for the manufacture and marketing of its cancer therapy for bladder cancer, Indevus Pharmaceuticals Inc. disclosed that a North Carolina hedge fund has acquired 8.5 percent of its common stock.
Lexington, Mass.-based Indevus made the announcements via regulatory filings late Friday and early Monday with the Securities and Exchange Commission.
On Friday, the company said the U.S. Food and Drug Administration had approved its supplemental new drug application for Valstar, a therapy that aims to treat bladder cancer through an injectable technology.
Valstar was first approved by the FDA in 2002, however design as well as manufacturing issues have prevented Indevus from marketing the drug in the United States since 2002.
Indevus said it intends to market Valstar during the second half of this year.
Bizjournals.com – After watching Sonesta International Hotels Corp. lose roughly 70 percent of its stock market value over the past 18 months, a Connecticut hedge fund has shed roughly a third of its holdings in the Massachusetts-based hotel operator.
In a recent regulatory filing, Mercury Real Estate Advisors, based in Greenwich, Conn., said it sold around 23,400 shares of Sonesta stock (Nasdaq: SNSTA) between Jan. 20 and Feb. 10, bringing its total ownership in the company to 206,048 shares. Those holdings equate to around 5.6 percent of Sonesta’s common stock outstanding.
Mercury’s ownership stake was more than 9 percent in mid 2007, when Sonesta’s stock traded above $30 a share. Sonesta’s stock opened Monday at $9.50 a share.
