Cooperman May Stick Client With Part of Legal Bill (Bloomberg)
Leon Cooperman, the hedge fund billionaire accused of insider trading by the U.S. Securities and Exchange Commission, may turn to his investors as a last resort to help defray the costs of his legal battle with the government. Cooperman’s Omega Advisors is withholding less than 1 percent of assets being redeemed to cover legal costs if they far exceed what he’s expecting, according to investors who asked not to be identified because the firm is private. He told clients he anticipates his insurance will cover all the expenses, and if necessary he’ll spend some of his own money.
Ackman’s Fund Says Employee’s Donation To Mass. Politician May Have Violated Law (Reuters)
Hedge fund Pershing Square Capital Management said in a regulatory filing made public on Tuesday that U.S. authorities were looking at whether a 2013 campaign donation by a former employee to a Massachusetts politician violated federal campaign finance laws. The fund run by William Ackman, which said it did not believe the donation violated the rule in question, asked the U.S. Securities and Exchange Commission to exempt it from the penalty for that violation, having to pay back tens of millions of dollars in fees it earned for managing money for the Massachusetts state pension fund.
U.S. Probes Hit Defunct Energy Co Linked To Platinum Partners (Reuters)
At least four U.S. agencies are investigating former officials of a now-bankrupt oil and gas company once majority owned by troubled hedge fund manager Platinum Partners, according to a legal filing submitted last week. In a motion filed with federal bankruptcy court on Nov. 23, a group of 10 directors, officers and employees of Black Elk Energy Offshore Operations LLC [BLCELB.UL] said an undisclosed number of them had incurred costs from investigations by the U.S. Attorney’s office in Brooklyn, New York, the U.S. Securities and Exchange Commission, the Internal Revenue Service, and the U.S. Postal Service.
Coliseum Capital In Talks Over Potential Performance Sports Deal (Reuters)
Hedge fund Coliseum Capital Management LLC, the third-largest shareholder of Performance Sports Group Ltd, said it was in talks with a third party related to a potential deal involving the maker of Bauer ice hockey gear. Performance Sports, which filed for bankruptcy protection in October, has received a “stalking horse” bid from its largest shareholder Sagard Capital Partners LP and Fairfax Financial Holdings Ltd. A “stalking horse” bid is an opening offer that other interested bidders must surpass if they want to buy the company.
Bill Walton, Old Einhorn Enemy, Makes A Comeback With Trump Role (Bloomberg)
Bill Walton was at the top of Washington’s finance establishment when he ran Allied Capital Corp. and sat on the Riggs Bank board alongside the city’s titans. Then the trouble began. Hedge fund manager David Einhorn accused Allied in 2002 of inflating the value of its holdings, sparking a fight that lasted years. A subsidiary that loaned to small businesses agreed to settle fraud claims with the Justice Department for $26.3 million in 2010, an executive went to prison and Allied, hobbled by the financial crisis, was sold. So was Riggs, after it was fined $16 million for helping former Chilean dictator Augusto Pinochet and Equatorial Guinea officials hide funds.
Cognizant Technology Can Do This The Easy Way Or The Paul Singer Way (DealBreaker)
IT-outsourcer Cognizant Technology CEO Francisco D’Souza returned to work after Thanksgiving to find that most unwelcome thing on his desk: A fat envelope with a return address on West 57th Street. Enclosed therein was Elliott Management’s take on his company, which boils down to: Stop wasting money trying to grow, because if you hadn’t noticed that’s not happening anymore, and start sending that money to us. Of course, no CEO likes to find out that Paul Singer just made his biggest-ever initial bet on his company. But it could have been so much worse. After all, it was just a letter and not legal service.
Samsung Sends Careful Message With Revamping Talks (The New York Times)
Samsung Electronics has set a cautious tone with Elliott Management, an activist hedge fund run by Paul Singer. The South Korean electronics giant, part of the larger Samsung empire that is controlled by the family of its chairman, Lee Kun-hee, says it will consider using a holding company structure. It is a measured but welcome response to the activist investor’s revamping proposals. Plans to increase dividends and buy back more stock also show that the company is serious about improving relations with its shareholders.
Tybourne Capital’s Anand Plans Asia-Focused Hedge Fund (Bloomberg)
Amar Anand, managing director and sector head at Tybourne Capital Management, is preparing to leave the Hong Kong-based money manager to start his own global Asia-focused hedge fund, according to a person with knowledge of the matter. Auroville Investment Management, also based in Hong Kong, will start trading a long-short equity fund April 1, the person said, requesting anonymity because the plans haven’t been publicly disclosed. The fund will use data science to complement its fundamental research methods and target annual returns of about 15 percent, the person said.