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New York (HedgeCo.net) – A new hedge fund is being launched to bridge the distance barrier between New Zealand and the rest of the world. Milestone Capital has established the Rutherford Innovation Fund to raise capital and back innovative companies which need financial assistance and business skills to commercialise their ideas on the international stage.
“The Rutherford Innovation Fund provides offshore investors with an experienced local co-investment partner to bridge the geographic gap to New Zealand as these companies are not on the radar of international investors,” Milestone Capital principal Kenji Steven says.
The Rutherford Innovation Fund sees the best opportunities for investment as being those that benefit from the massive changes being driven by the growth of Clean Tech products, services and technologies that provide solutions to urgent global problems around energy, water, carbon and pollution.
The fund is named after Ernest Rutherford, the Kiwi who was the first person to split the atom and the father of modern nuclear physics. It’s a portfolio of private equity companies which include algae fuel manufacturer Aquaflow Bionomic Corporation, carbon sequestration firm Carbonscape and ‘top five’ international climate change website Celsias.
“The key limiting factor in New Zealand is capital. For private companies investment capital is scarce so there is attractive pricing and little competition for deals. The capital markets are also under-developed so approximately 80% of the top 200 New Zealand companies are private,” Steven says. The fund is targeting a capital raising of NZ$50 million over the next two years.
New York Post – The days of hedge funds operating behind a curtain may soon be over.
Bruised and bloodied by unprecedented losses, hedge-fund investors are rebelling, demanding lower fees, greater transparency and, in a growing number of cases, unfettered access to their dough.
They’re doing this through separately managed accounts (SMAs), which basically act as a portfolio for individual investors.
SMAs are common with brokerage firms but have long been shunned by hedge-fund managers.
Mike Murray of Shoreline Trading Group, which acts as a prime brokerage for small hedge funds, said he’s seeing such a spike in demand for SMAs among hedge fund investors that he expects them to double by next year.
Globe and Mail – Desjardins Group is winding down hedge fund-linked products, as Canada’s largest financial co-operative joins life insurers in dealing with problems in guaranteed investments that have been pounded by the downturn.
Montreal-based Desjardins is shutting down lines of what are known as "principal-protected notes," or PPNs, an extremely popular product with individual investors. The move comes as Manulife Financial and Sun Life Financial take reserves against possible losses on annuities and other funds that promise customers’ capital will always be returned.
The products that Desjardins killed bought hedge funds to offer the co-op’s 5.8 million customers the upside of markets, along with a guarantee they would get back 100 cents on the dollar. Desjardins is closing PPNs called the Perspectives Plus Guaranteed Investment and Alternative Guaranteed Investment, both of which come due over the next five years.
West Palm Beach (HedgeCo.net) – Trilibis Mobile announced today that it has raised $5.7 million in Series B financing.
Alternative Investor Altos Ventures led the round with participation from ATA Ventures and several early individual investors. Ho Nam, General Partner and Co-Founder of Altos Ventures, has joined the board of Trilibis Mobile. Mike Hodges, Managing Director of ATA Ventures, has joined as a board observer.
"Trilibis has done a great job of establishing relationships with Tier 1 carriers and proving out the SmartPath platform with key content partners," said Ho Nam of Altos Ventures. "With this capital infusion, we look forward to working with the Trilibis team to continue to take market share and grow the business."
The newly raised capital will be used to fund development of the next generation of SmartPath to include support for native applications for BlackBerry, iPhone, Windows Mobile and Android devices. Additionally, Trilibis will devote some of the capital to boost its marketing and sales efforts.
"The tremendous increase in consumer adoption of smart phones has fueled the growth in mobile data services usage," said Alex Panelli, CEO of Trilibis. "Our objective is to capitalize on this emerging trend."
With this funding, Trilibis has raised a total of $8.3 million since inception.
Altos Ventures is a first-stage venture capital firm focused on leading investments in emerging technology companies with the goal of building market leaders. Altos manages $200 million in dedicated first-stage capital on behalf of leading endowment, fund-of-funds, financial and family office investors based in the United States and Asia.
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The Wall Street Journal – A group of four law firms has filed additional investor arbitration claims against Bear Stearns Cos. and a fund manager alleging the firm was less than candid with investors in one of its hedge funds.
"Our investigation indicates that officials at Bear Stearns engaged in a concerted effort to conceal the true state of affairs at this hedge fund, for an extended period of time before it imploded and that the victims of this nefarious scheme included both individual investors and professional money managers from around the world," said Steven Caruso of Maddox Hargett & Caruso, one of the law firms.
The claims were filed with the Financial Industry Regulatory Authority on behalf of investors in Bear Stearns’ High Grade Structured Credit Strategies Fund. Last summer the fund failed along with the company’s High-Grade Credit Enhanced Leveraged Fund, costing investors $1.6 billion.
Reuters – Wachovia Corp said on Monday it has had significant losses from a Citigroup hedge fund, joining Fifth Third Bancorp, which disclosed its loss in an April lawsuit.
Wachovia spokeswoman Christy Phillips-Brown said a $315 million write-down the bank disclosed earlier in May was related to investments in Citigroup’s Falcon Strategies hedge Fund. Wachovia, the fourth-largest U.S. bank, made the investments through its bank-owned life insurance portfolio.
Fifth Third said in a lawsuit filed on April 17 that it had invested $612 million in Falcon. The bank is looking to recover $323 million in damages from the two AEGON NV subsidiaries that had been managing its bank-owned life insurance portfolio.
Citigroup, Aegon and Fifth Third could not be immediately reached for comment.
An unidentified third bank also took a large loss in Falcon, the Wall Street Journal reported on Monday, citing sources familiar with the matter.
The Journal said the banks could ask Citigroup to give them some of their money back, because it has already agreed to do so for individual investors.
