Major hedge fund dumps Best Buy

Hedge fund manager extraordinaire David Einhorn bet big on Best Buy stock. Then he lost big on Best Buy stock.

In a letter to investors Monday, Einhorn’s Greenlight Capital said it sold off its 2.27 percent stake, or 7.7 million shares, in the Richfield-based consumer electronics giant. Greenlight didn’t disclose its exact loss, but a Star Tribune analysis of Greenlight’s stock purchases indicate the firm’s losses could approach $100 million.

Among the reasons Greenlight decided to liquidate its Best Buy position: the recent departures of former CEO Brian Dunn and chairman/founder Richard Schulze. In April, Dunn suddenly resigned amid allegations he had an affair with a female employee. A subsequent board-led investigation concluded Dunn’s actions were inappropriate and that Schulze knew of Dunn’s behavior but failed to inform other directors. Schulze ultimately resigned.

“As a result, the company has an interim CEO and is trying to come up with a strategy,” the letter said. “We worried that this could lead to additional business disruption so we exited with a loss.”

Read complete story here

About the HedgeCo News Team

The Hedge Fund News Team stays on top of breaking news in the Hedge Fund industry on an hourly basis. Signup to HedgeCo.Net to recieve Daily or Weekly news updates from our team.
This entry was posted in Hedge Fund Performance, Syndicated. Bookmark the permalink.

Leave a Reply