Avenue Capital Says Raising 200 Million Pounds for Debt Fund (BusinessWeek)
Avenue Capital Group LLC, the U.S. hedge fund founded by billionaire Marc Lasry and his sister Sonia Gardner, said it plans to raise 200 million pounds ($328 million) for a fund buying European corporate loans and distressed debt. Avenue Capital Credit Opportunities Ltd. will seek to sell 20 million shares at 10 pounds each with an annual dividend target of 5 percent, it said in a statement to the London Stock Exchange. The fund will invest in direct loans to European companies as well as non-performing loans and other “undervalued opportunities,” according to the statement.
Hedge Funds Circling Venezuela as Yields Top 15%: Andes Credit (Bloomberg)
Hedge funds are stepping in to fill a vacuum in Venezuela’s bonds as deepening concern the nation will default triggers an investor exodus. The debt, which suffered the worst selloff in emerging markets as Standard & Poor’s cut the country’s rating to CCC+ and predicted at least a 50 percent chance of non-payment in two years, has become increasingly attractive to firms including Greylock Capital Management LLC and Callaway Capital Management LLC. The government notes now yield 15.7 percent on average, the most in developing nations, while bonds from the state-owned oil producer are also among the cheapest dollar-denominated corporate securities in the world.
JOBs Act: SEC Warns Hedge Funds Of Misrepresenting Themselves In Advertising (HedgeCo)
The SEC has warned that 13 hedge funds and their advisers have been only reporting favorable information about themselves, leaving out their losing bets in past performance when advertising under the new JOBs Act. “We plotted the accounts that were allocated winning trades more often than losing trades.” Andrew Bowden, head of the SEC’s Office of Compliance, Inspections and Examinations, said at a CFA Institute conference in Boston, ” we came out of that and found 13 hedge funds that had accounts that were being disproportionately allocated favourable trades.”
Warren Buffett also a loser in Tesco debacle (Independent)
He may be known as the Sage of Omaha for his stock-picking prowess. He may have made his investors more than $2bn by backing Goldman Sachs Group, Inc. (NYSE:GS) when it was on its uppers. But Warren Buffett has dropped a £100m clanger with his persistent backing for Tesco. An analysis of his Berkshire Hathaway Inc. (NYSE:BRK.A) investment group’s trading in Tesco shares shows how it added to its 260m holding of Tesco stock last autumn with a big punt to buy 75m more – costing between £240m – £260m. But the share price fell pretty much instantly – and kept on falling.
Cattegatt Sees Better Hedge Fund Side Pocket Prices (Finalternatives)
London-based specialist broker Cattegatt Secondaries says hedge fund side pocket pricing is improving, thanks to an improving economy. Side pocket accounts are used by hedge funds to separate illiquid assets from other more liquid investments. Investors who leave a hedge fund are still entitled to a share of the profits from the sale of such assets, and Cattegatt Secondaries said better market liquidity and a more active M&A climate for exits have helped reduce the amount of time investors must wait to get their funds back.