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.
Forbes – Lobbyists for the $2 trillion hedge fund industry made a last ditch effort Wednesday to convince U.S. securities regulators to let an emergency order prohibiting short selling in more than 950 financial firms expire Thursday.
"The orders have not prevented price declines of financial institutions, volatility in the securities of these firms, or the failure of a financial institution," said Richard Baker, president of hedge fund lobby group Managed Funds Association.
Baker said the emergency orders have increased volatility, reduced liquidity and abruptly halted capital-raising, including through the issuance of convertible securities.
But a number of securities law experts expect the Securities and Exchange Commission to extend the ban beyond Thursday because of the current fragile state of the markets.
Under the SEC emergency measures, short selling in the U.S.-listed financial firms stocks has been prohibited for about two weeks.
Forbes – A federal judge in Florida ruled Wednesday that the head of two hedge funds deceived investors about the funds’ holdings. Elsewhere, federal regulators accused a California investment adviser of making tainted recommendations to clients.
In the Florida case, U.S. District Judge Kenneth Marra ruled that Michael Lauer, the head of Connecticut-based hedge funds Lancer Management Group and Lancer Management Group II, engaged in a fraud that cost investors about $500 million, according to the Securities and Exchange Commission.
Marra granted the SEC’s request for summary judgment against Lauer, finding that he overstated the hedge funds’ values from 1999 to 2002, manipulated the prices of seven securities that were an important part of the portfolios, and deceived investors about the funds’ holdings by providing them with fake financial statements.
Forbes – Russia’s government and central bank must act to lure additional funds into its financial market, President Dmitry Medvedev said on Thursday.
"The government and central bank should undertake all necessary measures to ensure inflows of additional funds into the financial market," Medvedev told reporters ahead of a meeting of government officials on financial markets.
"The situation on the Russian market today does not reflect the real state of the economy," he said. "Russian remains an attractive place for financial investments."
Russia’s stocks fell more than 5 percent on Wednesday to a fresh two-year low as poor performance prompted redemptions from hedge funds ahead of results, while falling oil prices weighed on future prospects.
The sell-off has seen the benchmark RTS index shed nearly half of its value since mid-March.
Forbes - U.S. activist hedge fund Atticus Capital has lost more than $5 billion this year, a source familiar with the matter told Reuters, after its funds were hit by heavy falls in financial stocks. Atticus, a high-profile player in deals such as Barclays‘ unsuccessful bid for ABN Amro last year, saw total assets under management fall to around $14 billion at end-July from more than $20 billion last year, the source said.
The losses were mainly due to a 32.9 percent loss in the $7 billion Atticus European fund from the start of the year to the end of August and a 25 percent fall in the Atticus Global fund.
The firm, which employs a variety of investor lock-ups, saw few investor redemptions. Atticus declined to comment. The firm, which views itself as a long-term investor, has nevertheless delivered strong performance in recent years.
In 2006 founder Tim Barakett earned $675 million, according to hedge fund industry publication Alpha Magazine.
Forbes – Swedish investor Cevian Capital is acquiring shares in Daimler AG in an apparent effort to become a significant shareholder in the German carmaker, Sueddeutsche Zeitung said, citing an unnamed hedge funds manager source.
It said financial sources consider it plausible that Cevian Capital could become a Daimler shareholder, adding the former already has a stake in Swedish truck maker Volvo.
It said Cevian acquired in Dec. 2007 a stake of nearly 3 percent in German insurer Muenchener Rueckversicherungs AG, one of the 30 blue chips on Frankfurt’s DAX30 index.
Forbes – Daimler AG. was told last week that a foreign hedge fund is buying a large number of shares in the car maker after its share price slumped on the back of a profit warning barely two weeks ago, Focus weekly magazine said.
Citing a supervisory board source, the magazine reported that banks have tipped off the company regarding the matter.
A company spokesman declined comment to Focus, saying only that Daimler is ‘satisfied’ with its shareholder structure and ‘is also open for new investors’.
Forbes – The dollar edged up towards a one-month high against the euro on Friday before monthly U.S. jobs data later in the day, with investors viewing the report as a key hurdle for whether the U.S. currency can sustain its rebound.
A mixed bag of U.S. data released the previous day showing the economy expanding less than expected in the second quarter, a spike in jobless claims but a pick-up in Midwest business activity did not prove decisive for the dollar. [ID:nN31399964]
Investors are still looking for the Federal Reserve to raise interest rates later in the year, just as mounting signs of economic slowdown from the euro zone to Australia have started to take a toll on other major currencies.
New York (HedgeCo.Net) – Matt Cohler, one of the early faces behind the wildly popular Facebook, will join venture capital firm Benchmark Capital. Cohler will assist in locating investment opportunities in web based services and will work with the company’s portfolio businesses, all while continuing to work with Facebook.
“Matt has set his sights extremely high, and at his young age has already helped to fundamentally change the face of the internet,” says Benchmark general partner Peter Fenton. “We could not be more thrilled to add Matt’s talents, relationships and passion to Benchmark.”
Coming on board with Facebook in 2005, Matt joined Forbes’ “Youngest Billionaire” Mark Zuckerberg and enjoyed profits of $150 million last year. Facebook is estimated to be worth as much as $15 billion. Prior to that, he was the Vice President and General Manager of LinkedIn, another social networking site for business professionals.
Benchmark manages approximately $2.8 billion in assets.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds! Be sure to check out our sister sites. For more information, visit www.hedgeconetworks.com
Forbes- Four hedge funds that own shares in Jelmoli Holding AG. have failed to win over investors at a vote over a proposed stock split and a special dividend at the Swiss retail and real estate companies.
The four funds Franklin Mutual, Fortelus, Sandelman und Obrem had filed a motion at Wednesday’s annual general meeting for a 5 to 1 split of the bearer shares and an extraordinary dividend of 115 Swiss francs, which would have resulted in owners of bearer shares losing voting power to holders of registered shares.
Investor Georg von Opel, who owns 25.2 percent of Jelmoli’s share capital but 52.9 percent of the voting rights, opposed the plans.
Forbes- Shares of railroad operator CSX Corp. may trade actively Thursday after a federal judge’s ruling opened the doors to a proxy battle later this month.
On Wednesday afternoon, the judge ruled that dissident shareholders broke the law in their effort to change CSX’s corporate structure, but did not block them from voting for their nominees to the company’s board.
Jacksonville, Fla.-based CSX had sued the two hedge funds in March, accusing them of using share swap contracts to evade federal securities filing requirements.
Forbes.com – The UK government is advising China on its private equity industry, with the Treasury passing papers on tax and regulation to Beijing, the Financial Times reported.
The newspaper said the move reflects London’s desire to gain a strategic advantage over the US in China, where private equity groups are eyeing investment opportunities.
‘We have pointed them in the right direction by passing on papers about a range of fiscal and regulation policies for private equity,’ the newspaper quoted a senior Treasury official as saying.
