Warren Buffett’s BNSF and Canadian Pacific Railway gets U.S. deadline to solve grain backlog (Financial Post)
Warren Buffett’s BNSF Railway Co. and Canadian Pacific Railway Ltd. face a June 27 deadline to say how they will clear a backlog of grain shipments that has some farmers fuming over rotting wheat and late deliveries. The U.S. Surface Transportation Board ordered the railroads to outline by then how they will deal with service disruptions, including a timeline for doing so, and to subsequently provide weekly updates about their progress. “The board remains very concerned about the limited time period until the next harvest, the large quantities of grain yet to be moved, and the railroads’ paths toward meeting their respective commitments,” the STB said in a decision released June 20.
Exclusive: Paulson & Co amasses large stake in Allergan: sources (Reuters)
Hedge fund Paulson & Co has amassed a large stake in Allergan, Inc. (NYSE:AGN) of more than 6 million shares and supports a deal between the Botox maker and Valeant Pharmaceuticals Intl Inc (NYSE:VRX), people familiar with the matter said on Wednesday. The position is expected to make the prominent U.S. hedge fund, led by John Paulson, one of the top 10 to 15 holders of Allergan, according to Thomson Reuters shareholder data as of March 31. Valeant and its ally, Bill Ackman‘s Pershing Square Capital Management, are seeking to call a meeting to elect new directors to Allergan’s board, which could pave the way for a takeover of the company.
Hedge fund firm rehired by state for pension advice (Boston Globe)
As the Massachusetts state pension fund overhauls the way it invests in hedge funds, it has rehired a money management firm the fund once dropped — this time only to offer advice about funds run by others. The state’s Pension Reserves Investment Trust has tapped Arden Asset Management of New York as its new hedge fund consultant. Arden, which manages $6.3 billion by investing money in other hedge funds, was one of many firms ensnared in the Bernard Madoff scandal. The Madoff bankruptcy trustee sued Arden to recover $43.4 million in a case that remains unresolved.
Bain’s Balson Strikes Out On His Own (FINalternatives)
A two-decade veteran of Bain Capital has left that firm to found a private-equity shop of his own, focused on unusually long-term investments. Andrew Balson’s as-yet-unnamed Boston-based firm will eye investments to hold for 10 years or more, The New York Times reports. The average p.e. firm owns a company for just three to five years. Bain Capital informed investors that Balson, who has been with the firm since 1996, would be leaving in December.
Soros Fund Boosts Stake in Penn Virginia While Pressing for Sale (Wall Street Journal)
Penn Virginia Corporation (NYSE:PVA) said its largest shareholder, Soros Fund Management LLC, has increased its stake to 9.53%. In addition, the hedge fund, founded by billionaire investor George Soros, reiterated in a letter sent to the Penn Virginia board on Wednesday that the best path to maximize shareholder value would be a sale of the oil-and-gas company. Share recently traded up 9.2% at $16.13.
Diversifying portfolio key for hedge funds: Pro (CNBC.com)
Monroe Capital terminates, sues managing director over alleged confidentiality violations (Pensions & Investments)
Warren Woo was terminated as managing director of Monroe Capital over “serious violations of company policies relating to confidentiality and appropriate use of information systems,” Theodore L. Koenig, president and CEO of Monroe Capital, said in a statement the company e-mailed to Pensions & Investments. A lawsuit filed June 19 by Monroe Capital and related firms against Mr. Woo alleges he took “confidential, proprietary, and critical information and trade secrets from Monroe” to assist a competing firm he was helping to form, Breakaway Capital, a private equity firm. The suit is pending in U.S. District Court in Chicago before Judge Milton Shadur.
Toronto manager Stephenson plans to launch C$40 mln hedge fund (Reuters)
John Stephenson, a prominent Toronto-based money manager, said on Wednesday he plans to launch his own hedge fund, a vehicle he thinks will be best-placed to take advantage of potential volatility in stock markets trading near record highs. A former executive at First Asset Investment Management, Stephenson expects his first product to be a C$40 million ($36.86 million) North America-focused fund. He hopes to follow that up with other offerings and sees the money manager playing an activist role in corporations over time.
What Happens When the Vulture Funds Start Circling (Wall Street Journal)
The standoff between Argentina and some hedge funds playing out in New York federal court this month isn’t the first time Wall Street has faced off with a sovereign debtor. Argentina’s 13-year dispute with the group of creditors opened a new chapter on June 16 when the U.S. Supreme Court sided with the hedge fund holdouts and denied the country’s appeal of a lower-court decision. The holdouts, led by Elliott Management-subsidiary NML Capital, are demanding full repayment before permitting the country to compensate other lenders who had accepted the terms of prior restructurings.
Bitcoin Auction Draws Wall Street, Silicon Valley Bidders (Bloomberg)
Buyers from Wall Street to Silicon Valley are lining up to bid on a cache of bitcoins worth about $17 million, underscoring the interest in the digital currency even after its boom and bust. Pantera Capital Management, a San Francisco hedge fund backed by Fortress Investment Group, and SecondMarket Inc., a New York brokerage, are among those seeking to buy bitcoins from the U.S. government at an auction scheduled for June 27. A broad swath of interested parties, from individuals to institutional investors, have requested information from the U.S. Marshals Service, which is handling the sale.
Japanese investors to maintain hedge fund allocations, says survey (HedgeWeek)
Japanese investors plan to maintain the size of their hedge fund allocations this year, according to a survey by AIMA Japan and Eurekahedge. The survey of more than 130 investors with over USD3.8 trillion in assets revealed that the average percentage of their alternative investment portfolio going to hedge funds will remain the same for 2014 as for 2013, at 72.5 per cent. The survey follows strong recent performance by Japanese-investing hedge funds and funds of funds, which were up about 28 per cent on average in 2013.
