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CNNMoney.com – New York hedge fund Elliott Associates LP lowered its offer price Tuesday for Epicor Software Corp., saying in a letter it was "extremely disappointed" Epicor’s board had recommended shareholders reject a takeover.
Elliott, a large shareholder in the Irvine, Calif., software company, told Epicor’s board that it will now offer $7.50 per share, which would value the company at $446.8 million based on the number of shares outstanding at Aug. 1. That’s down from Elliott’s previous offer of $9.50 per share, which valued Epicor at $565.9 million.
Elliott already owns 10.2 percent of the company’s shares.
CNNMoney.com – Dow Jones & Co. has suspended the publication of two hedge-fund benchmarks and the Dow Jones Hedge Fund Balanced Portfolio Index that incorporates them, saying that the underlying hedge funds have been deleveraging in an effort to reduce the risk to their investors.
Suspended are the Dow Jones Hedge Fund Equity Long/Short and Equity Market Neutral Strategy benchmarks. The 5-year-old benchmarks, and four others like them, measure individual hedge-fund strategies. Combined, the six make up the Dow Jones Hedge Fund Balanced Portfolio Index.
The request for the hedge funds to deleverage was made by Lyra Capital LLC. Lyra Capital is an investment manager and unit of Credit Agricole Structured Asset Management S.A. Lyra "provides the methodology programs used" in the Dow Jones Hedge Fund Strategy Benchmarks, the company’s Web site says.
CNNMoney.com – Wall Street equity traders usually thrive on volatility, but the latest arrival of carnage on their doorstep has distracted and confounded them.
This habitually brusque bunch is even more harried than usual, worrying about their livelihoods and the safety of their funds’ accounts in addition to the direction of a crazy market. One prominent form of escape: gallows humor.
Asked what floor he was going to in an office complex in Jersey City, N.J., an employee of one major brokerage replied, "I might as well go up to your floor, and apply for a job. It looks like we’re next."
Even the diehard speculators in the hedge-fund community are in a state of confusion. The funds have watched two of the prime brokerages that serve them collapse and another get swallowed by a bank in a few months, and some are close to sticking money under a mattress, said Lorenzo Di Mattia, manager of hedge fund Sibilla Global Fund. Some funds are too busy working out where to put their account to even bother with securities or commodities.
New York Post – With just two large investment banks remaining – Morgan Stanley and Goldman Sachs – questions are growing over who might step into the suddenly emptier playing field.
Many Wall Street watchers are pointing to the looming presence of large hedge funds and private-equity firms, which have been stealthily encroaching on many of Wall Street’s traditional lines of business for years now.
"I think the new Wall Street is not going to be on Wall Street," said Ferenc Sanderson, a hedge fund researcher at Thomson Reuters. "The headquarters of Citadel is in Chicago," he said.
Indeed, the $20 billion Citadel Investment Group is more often compared to Goldman these days.
Last year, Citadel branched into providing administrative and technical support to other hedge funds, not unlike the investment banks. Citadel also has a unit that executes trades for retail brokerages, akin to market makers like Morgan Stanley and Merrill Lynch.
It’s a far cry from the small operation Ken Griffin had when he founded Citadel with a modest $1 million in trading money in 1990.
