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.
Guardian Unlimited – Wolseley, the world’s biggest trade distributor of plumbing and heating supplies, said it was cutting 2,000 jobs in the UK. The group, which earlier this year said it was cutting more than 5,000 jobs, mainly in the US, warned that the cost-cutting programme involved the closure of some 200 of its 1,700 British branches.
Overall, Wolseley employs about 14,000 people in Britain; its best-known retail brands include Build Center and Plumb Center.
Guardian Unlimited – The threat of further redundancies hung over the City last night as it emerged that the investment bank Goldman Sachs is expected to cut at least 600 jobs in London. A wide-ranging cull of hedge funds in the capital was also predicted as the fallout from the banking crisis spread to vulnerable sections of the finance industry.
Goldman plans to cut 10% of its worldwide workforce to reflect the worsening economic conditions. It has about 6,000 staff in London. Sources close to the company said no decision had been taken on which countries or business lines would take the brunt of the cuts, but there was an expectation all operations would be hit.
Recently bailed out by the US government and a $5bn (£3bn) injection from the investor Warren Buffett, Goldman has seen many of its most lucrative business areas, including debt financing for mergers and takeovers, in effect closed down.
Guardian Unlimited – After being accused of precipitating the present financial crisis by short-selling banks, hedge funds are now turning their attention to student loans.
Jim Chanos, founder and president of Kynikos, one of the best known short- selling hedge funds in the US, has student loan companies high on his list to short for the foreseeable future.
‘This industry has much in common with the sub-prime mortgage industry,’ Chanos said. ‘Things do not look very bright.’
They don’t. More than two-thirds of American university students rely on loans to pay for college, but loan applications are being turned down in record numbers as the near collapse of the credit market is making all but the most secure loans impossible to write.
Guardian Unlimited – When Simon Jordan bought Crystal Palace in July 2000, flush with £36m from selling his mobile phone company to One2One, the club’s fans could hope that he would deliver Premier League football and a ground shinier than today’s weathered Selhurst Park. Eight years on, with Jordan having fought sundry energetic battles and become something of a celebrity – and with Palace having enjoyed a single season in the Premier League – he says almost all of that money has been spent. Palace are in the Championship relegation zone, still do not own Selhurst Park and are mortgaged to a hedge fund, Agilo, which describes itself as specialising in "distressed companies".
Jordan laughed at the idea that Palace is a "distressed company" and emphasised that he is not under financial pressure. But he did say he has had enough of football and he does want to sell the club.
"I want to do other things," he said. "I will miss the fans, and I will miss Neil Warnock [Palace's manager], but I won’t miss much else. I’m fed up with avaricious footballers."
Guardian Unlimited- The struggling internet company Yahoo has struck a pact with its billionaire critic Carl Icahn by giving the hedge fund activist a minority presence on its board to avoid a potentially tempestuous showdown at a shareholder meeting next month.
Facing crumbling support among Yahoo investors, Icahn yesterday abandoned his efforts to overthrow the leadership of the embattled Silicon Valley company and force its sale to Microsoft.
Instead, the 72-year-old Icahn & Co hedge fund manager is settling for an offer of three seats on Yahoo’s board. One director will stand down and the board will expand from nine to 11 members. Wall Street analysts greeted it as a qualified victory for Yahoo’s founder, Jerry Yang, who has pressed hard to maintain its independence and who waged an energetic campaign to discredit Icahn.
Guardian Unlimited- Aberdeen Asset Management said on Friday its assets had grown 6 percent despite turbulent markets and had also earmarked higher cost savings to offset falling earnings, pushing its shares up.
The fund manager said its assets under management grew to 113.7 billion pounds ($227.5 billion) in the three months to end-June, from 107.3 billion the previous quarter.
Aberdeen warned that turbulent market conditions, which took 1.8 billion off its assets, would remain difficult in the coming months but said it remained confident of growing its business despite the tough environment.
Aberdeen CEO Martin Gilbert told journalists that investor confidence remained fragile, which had caused redemptions to run at a rate 50 percent higher than last year.
Guardian Unlimited- The Children’s Investment Fund has bought shares in two major investors in the Japanese company J-Power, weeks after its attempt to double its stake in the electricity supplier was blocked by the Japanese government.
The hedge fund – popularly known as TCI – bought minor stakes in Mizuho Financial Group, Japan’s second-biggest bank, Kajima Corp, a big construction company, and about eight other shareholders, as it exerts pressure on the management of J-Power ahead of its shareholder meeting next month.
