Einhorn: Here’s What I’m Still Long and Short (CNBC)
Widely followed hedge fund manager David Einhorn reiterated his belief in two existing positions at an investment conference Tuesday: A short bet against Athenahealth and a long play in AerCap, according to a person who witnessed the presentation. The remarks were made at an event hosted by Grant’s Interest Rate Observer in New York. A spokesman for Einhorn’s Greenlight Capital declined to comment. Athenahealth stock declined about 2.8% in morning trading and had been down more than 4% at one point. AerCap was up about 2.6% at the same time.
Berkshire Buys Nearly 10 pct Stake in Axalta for $560M (CNBC)
Warren Buffett’s Berkshire Hathaway Inc. will pay $560 million for a nearly 10% stake in Axalta Coating Systems, which has seen its stock rise more than 36% since it went public last fall. Axalta makes high performance coating systems for use on vehicles and in industrial markets. Axalta Coating Systems Ltd. said Tuesday that Berkshire will pay $28 per share to buy 20 million shares of Axalta from the private equity firm The Carlyle Group, which will still hold a 45% stake in the Philadelphia company after the sale. Berkshire’s price is a slight discount to the stock’s closing price of $28.33 on Monday.
Hedge-Fund Manager Kyle Bass Challenges Jazz Pharmaceuticals Patent (Wall Street Journal)
Hedge-fund manager Kyle Bass filed a patent challenge late Monday against Jazz Pharmaceuticals PLC and its narcolepsy drug Xyrem. The challenge was the latest salvo in Mr. Bass’s new battle against pharmaceutical companies that he believes host spurious patents to keep drug prices artificially high. The challenge was filed in the name of the Coalition for Affordable Drugs, an organization partly controlled by Mr. Bass. Shares of Jazz Pharmaceutical rose 0.4% to $168.70 in early trading on Tuesday after falling 2.9% in pre-market trading. The company didn’t immediately respond to a request for comment.
The World’s Largest Hedge Fund Had a Huge Quarter Betting Against the Euro (Bloomberg)
Ray Dalio’s dire view on Europe is paying off. His Bridgewater Associates, the world’s largest hedge fund, climbed about 14% this year through March in one of its strategies, according to a person familiar with the matter. The year-to-date return was fueled by a bet against the Euro, said the person, who asked not to be identified because the information is private. “The lack of aggressive policy action by the ECB and other governing actors has resulted in stagnation and depression across much of the Eurozone,” the $165 billion, Westport Connecticut-based firm wrote in its 2015 strategic report, a copy of which was obtained by Bloomberg News.
Peltz to Sonnenfeld: Get Your Facts Straight (CNBC)
Lashing back at critical comments from management expert Jeffrey Sonnenfeld, Trian Fund’s Nelson Peltz said Thursday the Yale “professor should do a little bit more digging” and get his facts straight. “I don’t mind anybody coming after me as long as they’re coming with facts,” the activist investor said in an exclusive interview with CNBC’s “Halftime Report.” “He’s a professor, I assume he’s telling his students to do good work. His work was just a bit faulty.”
Private Equity Billionaire Is Now Selling a Hedge Fund for the Masses (Bloomberg)
David Bonderman amassed a $3 billion fortune in private equity for sophisticated investors. He’s now selling hedge fund strategies to the masses. Bonderman, whose TPG Capital has owned companies such as Continental Airlines and retailer J Crew Group Inc., is using a family office that manages a portion of his money — Wildcat Capital Management — to back a startup investment business. Infinity Q Capital Management is offering retail and other investors a version of the hedge fund programs it uses for the billionaire, said James Velissaris, chief investment officer for the new firm.
Wall Street Law Firms Challenge Hedge-Fund Deal Tactic (Wall Street Journal)
A group of large Wall Street law firms have banded together in an unusual bid to clamp down on a popular hedge-fund strategy aimed at squeezing more money from corporate takeovers. Seven firms—including Cravath, Swaine & Moore LLP, Davis Polk & Wardwell LLP, and Latham & Watkins LLP— are urging changes to rules governing an “appraisal,” a legal move in which stockholders who feel shortchanged by a takeover seek a higher valuation.
KKR-Backed Energy Hedge Fund Said to Triple Loss Amid Audit (Bloomberg)
BlackGold Capital Management, the energy-focused hedge fund partly owned by KKR & Co., told investors that losses amid the oil slump in December were almost triple its initial report after an auditor examined how it valued debt holdings, according to two people with knowledge of the matter. The $2 billion investment firm revised the loss to 17% last month from the 6% decline it previously reported, according to the people, who asked not to be identified as the information is private. The Houston-based fund cited difficulty in valuing some energy bonds at the height of the market’s turmoil, they said.
Why You Should Worry About Your Fund Manager’s Love Life (Wall Street Journal)
When managers of hedge funds get divorced or married, it’s bad news for their investors. Their asset returns are likely to suffer. Worse still, the pain could last years. That is the conclusion from a working research paper by academics at the University of Florida and Singapore Management University. It is a notion famously raised by hedge-fund investor Paul Tudor Jones in 2013, when he said that one can “automatically subtract 10 to 20 percent from any [hedge-fund] manager if he is going through divorce.” The study reprints his quote in the introduction. Representatives of Mr. Jones had no comment.
