Mr Loeb has reportedly sold a large part of a $1bn position in Greek debt that soared in value in the wake of the buy-back deal unveiled by Athens on Monday. The trade will stand out as one of the most audacious bets on the eurozone debt crisis so far. Since its onslaught in 2009, the turmoil has wrong-footed financiers around the world. It also affirms Mr Dan Loeb’s position as one of the most successful hedge fund managers, particularly since the rest of his high-rolling industry has struggled to make returns all year.
Greenbrier rejects Icahn’s $543 million offer as not good enough (III)
U.S. railcar maker Greenbrier Companies Inc (NYSE:GBX) has rejected a $543 million (333.8 million pounds) bid from American Railcar Industries, Inc. (NASDAQ:ARII) which is controlled by activist investor Carl Icahn, saying the offer grossly undervalues the company. But Greenbrier said it remains ready and willing to continue discussions with Icahn, saying it believes that combining the two companies would offer substantial synergies and be beneficial to shareholders of both firms. American Railcar on Tuesday offered $20 per share for Greenbrier, reviving a nearly five-year old plan to combine the companies.
Citi secures hedge fund depository, custody and prime brokerage mandate (HedgeWeek)
Citi has been awarded a mandate from Brummer & Partners, Sweden’s largest hedge fund manager, to provide depositary, custody and prime brokerage services for its recently-launched Carve fund. “We are delighted to appoint Citi for our new Carve funds,” says Peter Thelin, chief executive and portfolio manager at Carve Capital. “Citi’s local presence, proprietary global sub-custody network and its ability to offer a multi prime brokerage model for Swedish investment funds, putting Sweden in line with the rest of Europe, have been important factors in our decision.”
Pension fund fires 1st shot in war against guns (OnlineSentinel)
The first sign that the Sandy Hook Elementary School massacre has changed the way we talk about guns in this country came from an unlikely place — Wall Street. Cerebrus Capital Management, a private equity firm and hedge fund, announced that it would immediately divest its ownership of the Freedom Group, a conglomeration of gun manufacturers including the maker of the Bushmaster rifle believed to be used to gun down 20 first-graders and six adults last week.
Wells Fargo acquires 35% stake in hedge fund firm (StarTribune)
Wells Fargo & Company (NYSE:WFC) has taken a 35 percent stake in The Rock Creek Group, a fund-of-hedge-funds company in Washington, D.C., as the nation’s No. 4 bank works to double its asset-management unit. Rock Creek, which has about $7 billion in assets under management and 50 employees, designs and implements customized funds of hedge funds and emerging market portfolios for institutional clients using proprietary analytics. The company was founded in 2002 by former World Bank treasurer and chief financial officer Afsaneh Beschloss. Beschloss was instrumental in developing the World Bank’s portfolio of alternative investments and private equity, according to Wells Fargo.
Insider Verdicts Likely To Propel SAC Case (WSJ)
A guilty verdict against two hedge-fund managers for insider trading might enable prosecutors to get a step closer to SAC Capital Advisors LP founder Steven A. Cohen, lawyers and others familiar with the case said. Federal prosecutors in Manhattan and the Federal Bureau of Investigation will now train their sights on Michael Steinberg, a 15-year SAC portfolio manager who is close to Mr. Cohen. Prosecutors have alleged Mr. Steinberg traded based on the same inside information as Anthony Chiasson and Todd Newman, the managers at two other hedge funds convicted Monday afternoon after a trial, people familiar with the case said.
SEC Targeting 4 Hedge Fund Developments in 2013 (AdvisorOne)
Bruce Karpati, head of the SEC’s Asset Management Unit, housed within the agency’s Enforcement Division, told compliance officers Tuesday that overseeing hedge funds’ compliance will continue to be a priority for the agency next year. Speaking at the Regulatory Compliance Association’s conference in New York, Karpati said that from 2010 to present, the SEC’s Enforcement Division has brought more than 100 cases against hedge fund managers, “a significant majority of which involved conflicts of interest, valuation, performance, and compliance and controls.”
State Treasurer Lockyer wants pension funds to purge some gun investments (Sanluisobispo)
Treasurer Bill Lockyer has asked the state’s two largest public pension funds to purge their portfolios of gun manufacturers that make firearms that are illegal in California. Lockyer, a board member of both the public employees’ and teachers’ retirement systems, made the request Monday afternoon following revelations that CalSTRS has a stake in the company that makes rifles like the one used in last week’s Newtown, Conn., school shooting.
Hedge fund trades that made top grade (FT)
Hedge funds have struggled through another bracing year. The average manager has made just 4.9 per cent in the past 11 months, according to Hedge Fund Research – hardly the kind of eye-watering returns the industry is known for, or charges for. Amid the disappointment, though, some trades have paid off. A handful of funds have made billions through large, often directional, contrarian bets. In March, buying Greek debt did not seem like such a clever move. Several hedge funds had just had their fingers burnt by Greece’s long-expected debt restructuring. Leading market commentators – such as Pimco’s Mohamed El-Erian in the FT – said it was “highly likely” the bailout would be found wanting, and a further restructuring was all but inevitable.
Another Hedge Fund Nailed for ‘No Skin in the Game’ (ComplianceWeek)
For at least the second time in seven months, the SEC has brought an enforcement action against a hedge fund for falsely informing investors that the fund or its executives were investing in the fund right alongside investors. The most recent enforcement action was filed yesterday, when the SEC brought settled administrative proceedings against Aladdin Capital Management, Aladdin Capital and a former executive, Joseph Schlim.
Is Copper the New Red Gold? (ResourceInvestor)
Federal detention centers in the San Francisco Bay area are slowly filling up with a new type of criminal. Thousands of illegal immigrants and petty drug dealers are being joined by a rising tide of copper thieves raiding abandoned government facilities for their heavy gauge copper electrical wire. At current prices a decent night’s haul can net crooks up to $20,000 at black market recycling centers. Long known as “Dr. Copper”, because it is the only commodity with a PhD in economics, the red metal has been an excellent forecaster of economic activity around the world. Hedge fund managers have been impressed by copper’s ability to hold up, and even advance in the face of the “fiscal cliff”.
Even Gold Bull Jim Rogers Is Turning Cautious (CNBC)
With gold prices being hammered in recent weeks, and trading near four-month lows on Wednesday, longtime gold bull Jim Rogers is sounding a word of caution, saying it’s possible the correction in bullion may continue into the new year. “Just be careful, there’re too many bulls, including me, but I’m very cautious,” Rogers told CNBC. “Gold is having a correction— it’s been correcting for 15-16 months now— which is normal in my view, and it’s possible that [the] correction is going to continue for a while longer.”
Macquarie to Shut Singapore Infrastructure Fund on Outlook (Bloomberg)
Macquarie Group Ltd. (MQG) plans to shut its Singapore-listed infrastructure fund after selling assets including a port and highway in China because it doesn’t expect its share price to reflect the value of its holdings. Macquarie International Infrastructure Fund (MIIF) will distribute excess cash as a special dividend and divest three assets following a review by its adviser CIMB Group Holdings Bhd. (CIMB) The fund has about S$60 million ($49 million) in cash, according to Chairman Chiang Meng Heng.
30 Under 30: Hedge Fund Gadfly Turns Biotech Entrepreneur (Forbes)
Martin Shkreli, the 29-year old founder of MSMB Capital in New York, is best known to investors as an activist who battled billionaires and entrenched drug industry executives through blog posts, shareholder letters, regulatory filings, and even an attempted hostile takeover. But now Shkreli says that he is giving the fund’s money back to investors to focus on a new effort: a startup, called Retrophin, of which he is chief executive. The company is getting ready to start a clinical trial of its most advanced drug, code-named RE-021, in the first quarter of 2013. Shkreli is optimistic, based on conversations with the Food and Drug Administration, that this single study might be enough to obtain accelerated approval for the medicine in the U.S.
3 New York City pension funds to add up to 15 hedge funds (PIOnline)
Three of New York City’s five public pension funds are seeking to add as many as 15 hedge funds for direct allocations to reduce price swings in stocks and improve investment returns. The New York City Employees’ Retirement System, New York City Police Department and New York City Fire Department, which have a combined $70 billion in assets, are searching for event-driven funds, commodity trading advisers, and global macro and relative value managers, according to Seema Hingorani, head of public equities and hedge funds at the city comptroller’s office.
Trading places: Schonfeld woos talent from shuttered funds (NYPost)
Trading kingpin Steven Schonfeld is ready to turn the hedge-fund industry’s insider-trading pain into his gain. The head of the $2 billion Schonfeld Group, looking to double his firm’s size, previously scooped up top-notch talent from the shuttered Galleon Group and is ready to grab top traders from the recently closed Diamondback Capital Management. Both funds closed after executives got snared in US Attorney Preet Bharara’s massive insider-trading probe.
AIMA responds to the final implementation text of the AIFMD (Opalesque)
The Alternative Investment Management Association (AIMA), the global hedge fund association, has responded to the publication of the final text of the implementing measures of the Alternative Investment Fund Managers’ Directive (AIFMD) by the European Commission. The publication of the final text marks the conclusion of the current EU-wide legislative process and will shift the focus to a national level, with EU member states required to transpose the Directive into their national laws. Depending on the nature of their operations hedge fund firms may have to comply as early as July 2013 while many existing EU managers may have until July 2014 to apply for AIFMD authorisation.
More Boards Publicly Back Besieged CEOs (WSJ)
When the chief executive comes under fire, corporate boards are increasingly proclaiming their support for the embattled leader—even though the endorsement might be short-lived. During 2012, the boards of several big companies, including Procter & Gamble Co., PG +0.06% Research In Motion Ltd., RIM.T -1.39% PepsiCo Inc., PEP +0.23% News Corp NWSA +1.74% ., Credit Suisse Group AG CS +1.83% and Veolia Environment SA, took the unusual step of issuing statements backing their CEO. Rallying around a besieged chief can calm employees, lift a depressed stock price and borrow time so that he or she can deliver on a risky strategy. Management experts say the trend shows, in part, how boards are coping with harsh criticism from vocal hedge-fund investors.
