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 India – Wall Street, where hundreds of commodity traders lost jobs last year as the recession set in, is on a new hiring phase where banks and hedge funds want to pay top dollar but only to a few, highly productive people.
The actual number of hires is unlikely to match the pace seen during the commodities super-cycle from 2003 to 2008, when investment banks ran a maze of desks that handled almost everything in the energy, metals and agricultural space.
Bloomberg – HSBC Holdings Plc’s U.S. securities division will no longer extend structured financing to hedge- fund investors to leverage their investments, according to people familiar with the company’s plans.
The bank is halting the financing by its structured-funds products division and eliminating an unspecified number of jobs in New York, said one of the people, who asked not to be identified because the information hasn’t been made public. The group reports to Steven Phan, global head of the investment access and solutions groups in London, the person said. Phan declined to comment.
“Hedge fund-linked strategies tie up a lot of capital because of the illiquidity of the underlying hedge fund,” said Keith Styrcula, chairman of the Structured Products Association, a New York-based industry group. “Those were among the very first lines of business that firms were cutting back on.”
Philadelphia Bulletin – Chrysler LLC dissident lenders must reveal their identities by 10 a.m. today, a bankruptcy judge ruled, rejecting claims that their safety was at risk.
U.S. Bankruptcy Judge Arthur Gonzalez in New York forced the group to file a list of its members publicly, denying their request to reveal their identities only to the bankruptcy court. Judge Gonzalez said the lenders have no evidence that keeping their identities private would help protect them. The group seeks to block an auction of most company assets to an entity managed by Fiat SpA, an outcome Chrysler said would force it to liquidate, costing thousands of jobs.
Reuters – TMD Friction, a bankrupt German maker of brake pads for the auto industry, has been bought by private equity firm Pamplona Capital Management, TMD said on Friday.
Both sides declined to comment on the sale price. The acquisition will safeguard 3,800 jobs worldwide, TMD said.
"I’m delighted to be partnering with Pamplona who are highly supportive of TMD Friction and the long-term outlook for the group," TMD Friction Chief Executive Derek Whitworth said.
Hedge funds may cut 20,000 workers worldwide this year, a record 14 percent of the industry’s jobs, as investment losses and client withdrawals erode fees.
The dismissals will come on top of the 10,000 jobs that disappeared last year at the investment partnerships, according to estimates by New York-based Options Group, an executive-search firm. Employment peaked at 155,000 in 2007, and has since dropped to about 145,000, the firm said.
MSNBC – On the streets of Antigua, Texas billionaire Allen Stanford is a controversial figure. Some embrace him while others deride him as a modern-day colonialist.
But nearly all say they fear a U.S. investigation into the tycoon’s financial empire and Antigua-based offshore bank could damage the Caribbean island where Stanford is a household name, its biggest private employer and powerful business force.
"He’s providing jobs. He’s good for the economy. If he’s in trouble, that’s bad for us all," said George Green, manager of Cool Down Cafe, a hole-in-the-wall restaurant on a narrow street in St. John, the island’s capital.
Green’s comment was echoed across the twin-island nation of Antigua and Barbuda on Monday as news spread of a deepening probe into Stanford’s $50 billion Houston-based investment operation, Stanford Group Co, and its Antigua-based affiliate, Stanford International Bank.
Tax-news.com – Endeavouring to assuage fears and re-establish public confidence in the wake of one-day nationwide strikes, French President Nicolas Sarkozy has announced that local business tax or ‘taxe professionnelle’ will finally be abolished in 2010.
Expressing his determination to uphold his predecessor Jacques Chirac’s promise to end the highly controversial tax, President Sarkozy has underlined the importance of the measure – vital to maintaining industry in France and ultimately to the preservation of jobs, despite a total cost to the state estimated at EUR8bn.
Created in 1975 – ironically by the then Prime Minister Chirac – business tax forms one of four direct local taxes collected by councils, and represents around half of their tax revenue.
Reuters – Multibillion dollar hedge fund firm Magnetar Capital has shut its London risk arbitrage desk and cut seven jobs, the firm told Reuters on Monday, as the industry goes through its biggest crisis.
A spokesman said four traders and three support staff had left the 15-person London office of Magnetar, which runs multi-strategy hedge funds.
"There’s been an appropriate reduction in the office to reflect the decision of the firm not currently to do risk arbitrage out of its London office," the spokesman said.
