Renaissance Probed by Senate Panel on Tax Maneuver (Bloomberg)
A U.S. Senate investigative panel will hold a hearing July 22 to probe tax maneuvers by Renaissance Technologies LLC, the hedge fund started by billionaire James Simons, according to two people familiar with the matter. The hearing will focus on a trading strategy Renaissance used that converted its profits from rapid trading into lower-taxed, long-term capital gains. The strategy, which involved transactions with banks such as Barclays Plc (BARC) and Deutsche Bank AG, is also being questioned by the Internal Revenue Service.
Harbinger sues U.S. government over wireless company LightSquared: report (Reuters)
Phil Falcone‘s Harbinger Capital Partners has filed suit against the U.S. government, accusing it of reneging on an agreement regarding bankrupt Harbinger-backed wireless company LightSquared LP, the Wall Street Journal reported. Harbinger, in a suit filed on Friday in the U.S. Court of Federal Claims in Washington, said global positioning systems companies unlawfully used spectrum owned by LightSquared, the Journal said. The GPS companies and advocacy groups warned that LightSquared’s network could interfere with GPS.
David Einhorn flush with luck in poker’s ‘Main Event’ (CNBC.com)
Billionaire hedge fund manager David Einhorn is still alive after three days (and nearly 30 hours of play) in the World Series of Poker Main Event in Las Vegas. The head of Greenlight Capital is one of 6,683 players who put up the $10,000 tournament entry for a shot at the $10 million first prize. Some 746 players remain, and on Friday the so-called money bubble will burst. Only 693 players will make the money, with the minimum cash being worth $18,406. The lucky player in 694th place gets free entry into next year’s tournament; 695th gets nothing.
Potential Record Divorce Payout For Hedge Fund Boss Moves a Step Closer (Wall Street Journal)
A U.K. judge on Friday heard closing arguments in what could be the U.K.’s biggest ever divorce award in a case involving high-profile hedge fund manager Christopher Hohn and his estranged wife, Jamie Cooper-Hohn. Mr. Hohn, founder and manager of The Children’s Investment Fund Management LLP, a hedge fund that has donated millions of pounds of profits to charity, has been locked in a legal battle with Ms. Cooper-Hohn–who is chairman of CIFF, the charity affiliated to TCI–over how much of his fortune she is entitled to.
SS&C GlobeOp Hedge Fund Performance Index and Capital Movement Index (MarketWatch)
The gross return of the SS&C GlobeOp Hedge Fund Performance Index for June 2014 measured 1.16%. Hedge fund flows as measured by the SS&C GlobeOp Capital Movement Index declined 1.77% in July. “Due to semi-annual redemptions, net flows were negative for the month and represent a new 6-month low,” said Bill Stone , Chairman and Chief Executive Officer, SS&C Technologies.
Steven Cohen Writes a Big Check to the U.S. Government (New York Times)
Steven A. Cohen proved to be a stickler for the letter of the law when it came to paying the criminal penalty imposed on his former hedge fund as part of its guilty plea on insider trading charges. On April 10, Judge Laura Taylor Swain of Federal District Court in Manhattan gave Mr. Cohen’s SAC Capital Advisors up to 90 days to pay the $900 million penalty, part of an overall $1.2 billion criminal settlement reached with prosecutors last November. On Tuesday, the 90th day since Judge Swain accepted the firm’s guilty plea, Mr. Cohen’s firm made that payment in four installments, according to court records.
Portuguese issues impacting hedge funds? (CNBC.com)
KKR Said to Buy Stake in BlackGold for Hedge Fund Growth (Businessweek)
KKR & Co. L.P. (NYSE:KKR), the private-equity firm led by George Roberts and Henry Kravis, agreed to buy a stake in hedge fund BlackGold Capital Management LP as it continues to grow beyond buyouts, said a person with knowledge of the deal. KKR will take a 24.9 percent stake in Houston-based BlackGold, which makes credit investments in energy-related companies and assets, said the person who asked not to be identified because the transaction hasn’t been announced. KKR will share in BlackGold’s earnings, which include fees for managing money and for producing profits, the person said.
Highland Capital’s Okada Warns About Price-Sensitive Junk Debt (Moneynews)
Mark Okada, Chief Investment Officer of Highland Capital Management LP, is sounding the alarm on some high-yield, high-risk loans and bonds, which may be more susceptible to price swings as a result of record-low yields. “Prices are more sensitive to fundamental risks because the coupon is so low,” Okada said Thursday at a media briefing held by the Dallas-based hedge fund, which manages about $23 billion.
Hedge Fund Says Argentina Not Working to Negotiate Deal in Dispute (Wall Street Journal)
A hedge fund suing Argentina in a dispute over defaulted bonds said late Friday the country shows no signs of wanting to negotiate a settlement. The claim comes as the clock ticks quickly toward a July 30 deadline that is key for Argentina. If the country doesn’t reach a settlement by then it could default on its debt for the second time in 13 years. “Argentina is still refusing to negotiate with its creditors, either directly or indirectly, about any aspect of this dispute, and we have not heard that it has any plans to change course,” a spokesman for the hedge fund, NML Capital Ltd., said in a statement.
Aecom Technology Agrees to Buy URS for About $4 Billion (Bloomberg)
AECOM Technology Corp (NYSE:ACM) agreed to acquire URS Corp (NYSE:URS), the engineering and construction-management company targeted by activist hedge fund Jana Partners LLC, for about $4 billion to gain new services in markets including oil and gas. Aecom will pay the equivalent of $56.31 a share for URS in the cash-and-stock deal, or about 19 percent more than its 30-day average closing price, the companies said in a statement yesterday. Including debt, the value of the transaction would be about $6 billion. The per-share price is about 8.2 percent more than URS’s July 11 close.
Credit Suisse’s Verde hedge fund betting on a Brazilian rate cut (Reuters)
Money managers at Credit Suisse Group AG (ADR) (NYSE:CS)’s CSHG Verde FIC FIM, the biggest Brazilian hedge fund, are betting the nation’s central bank will soon begin to cut interest rates to revive a flagging economy. Verde stands by its bet that Brazil’s currency, the real, will fall despite central bank efforts to prop it up, as concerns grow over the sustainability of public finances and external accounts, the managers said in a letter to investors distributed on Friday.