Matthew Halbower’s Pentwater Capital purchased nearly 2.5 Million shares of Hypercom Corp (HYC) in May as the stock price plunged 20% since the end of April. At the end of March Pentwater had 1.95 Million shares of Hypercom when the stock price was nearly $12. Hypercom’s shares were below $4 in September 2010 and several insiders were buying at the time. Alex Meruelo, a large shareholder, bought more than 250 thousand shares at prices between $3.13 and $3.89. The same Alex Meruelo sold 2.8 Million shares of HYC at prices between $11.50 and $12.50. Usually insider sales aren’t very meaningful but not when the same insider reverses his opinion after a short period of time and a 200+% increase in the stock price.
The 20% decline in Hypercom’s stock was enough to make Matthew Halbower double his position. There are other hedge fund managers who are bullish about Hypercom as well. Cliff Asness’ AQR had $46 Million, Phill Gross’ Adage Capital had $31 Million, and Israel Englander’s Millenium Management had $15 Million in HYC at the end of March.
Matthew Halbower launched Pentwater Capital in 2007. He specializes in merger arbitrage and event-driven investing. Prior to starting Pentwater Halbower worked at Deephaven Capital following event-driven and distressed asset trading strategies.