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.
New York (HedgeCo.Net) – Citigroup Inc. will close its $400 million Tribeca Convertible hedge fund in what will help wind down the $2 billion Tribeca Global Investments Group, according to a report published on Bloomberg.com. The closing of the fund has not yet been made public, but investor redemptions are thought to be the reason for the fund’s demise.
The fund uses a convertible arbitrage strategy, which involves acquiring company bonds that can be converted to common stock which in turn may be shorted. Tribeca Convertible was down a mere 5 percent this year.
This is the latest failure in a string of attempts by Citigroup to offer their clients a broader array of alternative investments. Two months ago they closed the $800 million Old Lane Partners, founded by Citigroup CEO Vikram Pandit, after investors redeemed over $200 million.
Citigroup was hit hard by the subprime-related mortgage fallout last summer, forcing its hedge funds to suffer. The bank’s Falcon Strategies funds were closed this year, even after a $500 million influx of capital by Citigroup.
CSO Partners, another hedge fund run by Citigroup also closed its doors this year after suspending investor redemptions. The company wrote down over $15 billion in losses the first two quarters of 2008.
Tribeca Convertible Portfolio Managers Andrew Wang and Jeffry Chmielewski are rumored to be thinking about starting their own fund.
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
Bloomberg – Just when American International Group Inc. shareholders figured things couldn’t get worse at the world’s largest insurer, profit from the company’s private equity and hedge fund investments is evaporating.
Earnings from so-called alternative holdings were probably close to zero in the second quarter, after soaring 77 percent to $1.02 billion a year earlier, said Citigroup Inc. analyst Joshua Shanker.
The drop follows the worst first half for hedge funds in almost two decades and a 73 percent decline in the value of announced leveraged buyouts, according to data compiled by Chicago-based Hedge Fund Research Inc. and Bloomberg.
International Herald Tribune- A former manager of a Citigroup Inc hedge fund has filed a complaint with a British tribunal accusing the bank of causing his fund’s demise, the Wall Street Journal reported on Saturday, citing people familiar with the matter.
In a sealed complaint filed last month with a state-run employment tribunal, John Pickett, who ran a hedge fund known as CSO Partners that specialized in corporate debt, accuses the bank of pressuring CSO to buy billions of dollars in troubled loans, the newspaper reported.
Pickett said the loans undermined CSO and led to his resignation. Citigroup called the complaint "without merit," the Journal said.
MSN MoneyCentral- A former manager of a Citigroup Inc hedge fund has filed a complaint with a British tribunal accusing the bank of causing his fund’s demise, the Wall Street Journal reported on Saturday, citing people familiar with the matter.
In a sealed complaint filed last month with a state-run employment tribunal, John Pickett, who ran a hedge fund known as CSO Partners that specialized in corporate debt, accuses the bank of pressuring CSO to buy billions of dollars in troubled loans, the newspaper reported.
Bloomberg- Christian Kunze pays French farmers to install camouflaged, shoebox-sized “power stalkers” in fields near nuclear stations owned by Electricite de France SA, collecting data the world’s biggest utility says is a secret.
His company, Powermonitor, plans to sell information about reactor starts and stops in France less than three years after Kunze fended off spying charges from EDF’s German affiliate. Banks, hedge funds and traders will pay for such data to gain an edge in continental Europe’s $565 billion power market.
EDF is at the center of a battle over the disclosure of data Citigroup Inc. says may save European electricity users billions of euros a year. The state-owned utility refuses to release information on plant operations that its biggest competitors, E.ON AG and RWE AG, began reporting last year. Now the European Union may force the company to be more transparent.
BusinessWeek- Citigroup Inc.’s head of hedge fund services is leaving the company, according to an internal company memo.
Steve Bowman has worked at Citi, now the nation’s largest bank by assets, for 24 years in both the New York and London offices.
Friday’s memo from Jamie Forese, co-CEO of markets & banking at Citi, did not say who would replace Bowman. It did say Bowman would help in the coming weeks with the management transition.
Bloomberg- Wall Street is losing its top oil analysts as securities firms suffer record losses and hedge funds offer the promise of higher pay.
Morgan Stanley’s Douglas Terreson and Citigroup Inc.’s Doug Leggate, ranked first and second by Institutional Investor on coverage of the biggest oil companies, left their positions, the banks said. Geoff Kieburtz, the No. 3 analyst for oilfield contractors, is leaving Citigroup. Robert Morris, the top-ranked analyst for independent oil companies such as Anadarko Petroleum Corp., left Bank of America earlier this year.
Exxon Mobil Corp., Anadarko and other oil stocks rose to all-time highs this year as crude futures surged 46 percent to a record $139.89 a barrel and natural gas jumped 73 percent. The exits also came as banks and securities firms cut more than 83,000 jobs after the collapse of the subprime mortgage market led to $390 billion in writedowns and losses.
