Ackman-Roth Scored With Sears Before J.C. Penney Debacle (Bloomberg)
Just when it looked like 2013 couldn’t get worse for hedge-fund manager William Ackman, one of his longest-standing investment allies is abandoning ship. Developer Steven Roth last week sold more than 40 percent of the J.C. Penney Co (JCP). shares that his Vornado Realty Trust (VNO) acquired in conjunction with Ackman’s Pershing Square Capital Management LP in 2010. Vornado, which joined Pershing Square in winning wagers on McDonald’s Corp. and Sears Roebuck & Co., is cutting its stake after J.C. Penney’s declines left his firm and the hedge fund with combined losses topping $800 million.
Puerto Rico Beyond IRS Reach Woos Paulson-Sized Fortunes (Bloomberg)
Puerto Rico occupies a space between foreign and domestic status with U.S. citizenship for residents, its own Olympic team and a tax system that allows individuals and companies the chance to elude the IRS. The U.S. territory’s leaders are seeking to lure mainland residents such as hedge-fund billionaire John Paulson. Moving to Puerto Rico could allow Paulson and other top-earning taxpayers to shield future income from the Internal Revenue Service without giving up their passports.
E*Trade Slumps After Citadel Says It’s Selling Stake (Bloomberg)
E*Trade Financial Corp. (ETFC) dropped the most in five months after Citadel LLC, its largest shareholder, said it’s selling the rest of its equity stake in the fourth- largest online brokerage by client assets. Shares of the broker declined 5.8 percent to $11.14 at 11:06 a.m. New York time in the biggest intraday slump since Oct. 19. Before today, the New York-based company had gained 32 percent in 2013, compared with the 9 percent advance in the Standard & Poor’s 500 Index. Citadel, the Chicago-based hedge fund run by Ken Griffin, plans to sell its remaining equity stake, about 27.4 million shares, by March 19, according to a release yesterday from E*Trade.
Hedge Fund Assets Reach Record, Euro Crisis Fuels Liquidations: HFR (Barron’s)
Total hedge fund industry assets rose to a record $2.25 trillion at the end of last year, but liquidations were also at a three year high. That’s according to a report out today by Hedge Fund Research, which found that 1,108 new funds were founded in 2012, just five fewer than the year before, with 248 of those launches coming in the fourth quarter.
SandRidge Settles Fight With Hedge Fund (NY Times)
SandRidge Energy announced on Wednesday that it had settled with a hedge fund that had been calling for the removal of the oil company’s chairman and chief executive, Tom L. Ward. SandRidge said it would expand its board by four seats, giving the new positions to TPG-Axon Capital Management. The company also said it would decide by June 30 whether to remove Mr. Ward.
Former CFO of Westport hedge fund gets 41 months in prison (WestportNews)
The former chief executive officer of a Westport hedge fund was sentenced Thursday to 41 months in prison for embezzling more than $1 million. Darrin Foster, 46, a former resident of the Bronx, N.Y., in addition to imprisonment, faces three years of supervised release under the sentencing by U.S. District Judge Janet Bond Arterton in New Haven federal court.
Vodafone blasted for ‘decade of incompetence’ by hedge fund boss (TheGuardian)
Vodafone has surrendered any right to decide its destiny after a decade of “incompetence” and “failure” and should put itself up for sale, a leading Australian hedge fund boss said on Wednesday. In a searing critique of the British mobile giant’s global empire, John Hempton of Bronte Capital has called for the board to be sacked if it sells the company’s most precious asset, a 45% stake in the leading US carrier Verizon Wireless. The holding could be worth $115bn (£75bn) to Verizon Communications Inc. (NYSE:VZ), the fixed-line phone company which owns the other 55%, and there has been speculation Vodafone could cash in and spend the money on European expansion.
How to Vanish Like Florian Homm (Businessweek)
By the time Florian Homm was arrested last Friday at an art gallery in Italy, the former hedge fund manager and chief investment officer of Absolute Capital Management Holdings had been a fugitive for six years, accused of defrauding investors of $200 million. Six years? That’s just the beginning of our questions. Herewith, some answers.
February sees German hedge fund Varus Fund sustain winning streak (Opalesque)
The Cayman-domiciled Varus Capital Management’s Varus Fund, which is advised by Heieck Siebrecht Capital Advisors, sustained its winning streak so far this year with modest gains in the first two months of 2013 after ending 2012 with double-digit losses. The fund was up 0.83% in February after finishing January almost flat at 0.07% and bringing its year-to-date finish at 0.9%, while European indices were down between minus 1% and 9%. Varus’ performance in the first two months of 2013 was a welcome respite for the fund which ended 2012 down -13.8% and was in the negative in the whole last quarter of last year.