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.
Reuters – Fortress Investment Group LLC, one of the few publicly traded U.S. hedge fund groups, reported a narrower quarterly loss on surprisingly strong revenue Wednesday, and forecast improved demand for its portfolios in coming quarters.
Fortress executives said several funds delivered respectable returns in the first half the year, and they expect demand to pick up as financial markets recover.
CNBC – Fortress Investment Group LLC has named former Fannie Mae CEO Daniel H. Mudd as its new CEO, effective Aug. 11.
Mudd, a Fortress board member, takes over for co-founder and majority shareholder Wesley Edens. Edens will remain with the alternative asset manager as co-chairman, a title he will share with Peter L. Briger.
Fortress said late Sunday that the personnel change will allow Edens, along with Briger, Michael Novogratz, Robert Kauffman and Randal Nardone, to concentrate on managing existing investments and finding new investment opportunities. The four executives will continue to own about 70 percent of the company.
Bloomberg – Stanley Ku, former head of Fortress Investment Group LLC’s Hong Kong office, plans to start an Asia- focused hedge fund to profit from macroeconomic developments, according to a marketing document given to potential investors.
Minerva Macro Fund, to be managed by Hong Kong-based Ku, will start investing in early August, two people with knowledge of the plan said. It seeks to generate annual returns of 12 percent to 22 percent trading stocks, interest rate, currency and commodity instruments in large and liquid markets, according to the document, obtained by Bloomberg.
Bloomberg – Blackstone Group LP and Fortress Investment Group LLC are seeking to take over credit funds from managers unable to support their businesses after the value of investments fell.
There are “a lot of companies that are on the block,” Tony James, Blackstone’s president, said on a conference call yesterday with investors. New York-based Blackstone, the world’s biggest private-equity company, is “looking hard at consolidating acquisitions,” he said.
Reuters – Fortress Investment Group LLC , one of the few publicly traded U.S. alternative asset managers, said on Monday its quarterly loss more than quadrupled, hurt by writedowns in some private equity funds.
The net loss was $140 million, or $1.50 per share, compared with a reported net loss of about $29 million, or 43 cents, a year earlier, New York-based Fortress said.
Results reflected a $265 million loss in principal investments. This included a $228 million for investments in private equity firms, a $27 million loss on investments in hedge funds, and $10 million of interest expenses.
Reuters - Two years ago, investors scrambled to snap up shares in elite hedge fund firms, eager for a piece of the lucrative action. What they got instead were big losses.
Starting in early 2007, when hedge fund and private equity firms were minting cash, four private investment firms cracked open the door to let in small investors. Fortress Investment Group LLC, Och-Ziff Capital Management Group, Blackstone Group LP and GLG Partners Inc led a new class of firms that let ordinary investors ride the wave of hedge fund riches.
Interactive Investor - Man Group aims to win more business from big Asian investors such as pension funds and insurers even as global financial turmoil spurs some existing clients to redeem holdings and seek safety in cash.
The world’s largest listed hedge fund group recently hired an institutional salesperson in South Korea because of the potential it saw there and was studying the long-term opportunity in China, said Tim Rainsford, managing director, Asia Pacific for Man Investments.
"It’s certainly a challenging time. At the same time, the brakes are not on in the business. We will launch products when they’re appropriate," he told the Reuters Finance Summit on Monday.
Washington Post – A son and a brother of Sen. Joseph R. Biden Jr. (D-Del.) are accused in two lawsuits of defrauding a former business partner and an investor of millions of dollars in a hedge fund deal that went sour, court records show.
The Democratic vice presidential candidate’s son Hunter, 38, and brother James, 59, assert instead that their former partner defrauded them by misrepresenting his experience in the hedge fund industry and recommending that they hire a lawyer with felony convictions.
The legal actions have been playing out in New York State Supreme Court since 2007, and they focus on Hunter and James Biden’s involvement in Paradigm Companies LLC, a hedge fund group. Hunter Biden, a Washington lobbyist, briefly served as president of the firm.
A lawsuit filed by their former partner Anthony Lotito Jr. asserts in court papers that the deal was crafted to get Hunter Biden out of lobbying because his father was concerned about the impact it would have on his bid for the White House. Biden was running for the Democratic nomination at the time the suit was filed.
Reuters- Investment firm Duff Capital Advisors said on Tuesday it acquired hedge fund group North Sound Capital.
The two firms, both located in Greenwich, Connecticut, did not disclose terms of the deal.
For Duff Capital, which launched in March with the goal of raising between $1 billion and $1.5 billion to seed investment strategies, this marks its second hedge fund investment.
For North Sound Capital, whose assets have shrunk from $2.9 billion in 2006 to $1 billion now, the deal is a chance to join forces with Philip Duff, a Wall Street veteran with a track record of growing investment firms.
The Independent- The American hedge fund group Harbinger Capital Partners revealed that it has made a significant bet on HBOS’s price falling, while its UK counterpart GLG admitted it is targeting the rival mortgage bank Bradford & Bingley, as investors were forced yesterday to disclose their short positions to the market for the first time.
The Financial Services Authority shocked the trading community a fortnight ago when it announced that investors would be compelled to disclose short positions of more than 0.25 per cent of share capital in companies carrying out rights issues.
The announcements started on Friday, and continued yesterday with 20 investors, predominantly hedge funds, disclosing short positions in seven companies that are in the process of carrying out rights issues.
