The “criticism is deserved,” Ackman said on Friday of Ron Johnson, the former Apple executive who has been tasked with overhauling the staid retail chain and who has come under fire as the stock price has plummeted 27.6 percent in the first quarter. While Ackman has long been a public cheerleader for Johnson, often saying that he was a doing a great job, he tempered his normally upbeat comments on Friday at an investment conference sponsored by Thomson Reuters in Boston. Speaking bluntly, Ackman, who sits on the JC Penney board and whose $12 billion Pershing Square Capital Management is the company’s largest shareholder, said big mistakes have been made remaking the 110 year-old retail brand.
U.K. Pension Funds Add Inflation Hedges on BOE Stimulus Outlook (Bloomberg)
The U.K. pension funds of Royal Bank of Scotland Group plc (LON:RBS), aerospace components maker GKN Plc (GKN) and the London Pensions Fund Authority have bought inflation-linked bonds and derivatives to limit the impact of salary and price increases in their defined-benefit obligations. Royal Bank of Scotland Group plc (LON:RBS) purchased 2.9 billion pounds ($4.4 billion) of notional inflation swaps and 1.1 billion pounds of inflation-linked gilts last year to hedge its 25.6 billion-pound defined-benefit pension fund, according to its annual report published on March 27. GKN increased holdings of inflation-linked securities and swaps to 1 billion pounds in 2012, according to a Feb. 26 statement to analysts.
Most Paulson Funds Up In Q1 (FINalternatives)
The New York-based firm’s flagship Advantage Fund jumped 5.6% last month and is up 2.9% on the year. The more highly-levered Advantage Plus Fund rose 7.6% in March and is up 3.6% on the year. Paulson credited the funds’ “financials, consumer cyclical and noncyclical event-driven positions.”
Report: Falcone could lose LightSquared to hedge fund affiliated with Dish’s Ergen (FierceWireless)
Bankrupt LightSquared and a hedge fund connected to Dish Network (NASDAQ:DISH) Chairman Charlie Ergen could be headed for a showdown in bankruptcy court as the hedge fund has been buying up LightSquared debt, according to a Wall Street Journal report. Sound Point’s control over LightSquared’s debt gives it more leverage as LightSquared works through its bankruptcy proceedings, and could lead to Sound Point trying to get control of the company from Philip Falcone, the head of the Harbinger Capital Partners hedge fund, LightSquared’s principal backer. Sound Point’s founder, Stephen Ketchum, is a former banker at Bank of America and UBS and has a long-standing relationship with Ergen, the report said.
Chone Steps Down From Board of Galena Asset Management (Bloomberg)
Cedric Chone stepped down from the board of Galena Asset Management Ltd. to make way for non- executive directors. Chone continues to be portfolio manager at Galena Special Situations Fund, according to Geneva-based spokeswoman Victoria Dix. A filing with the U.K.’s Companies House showed his resignation from the board was on April 1.
How a TAMP, a New York startup, a $14-billion hedge fund and Brinks are part of bringing cold, hard gold closer to RIAs (RIABiz)
A New York based startup packed with luminary board members such as former Citigroup and Merrill Lynch exec Sallie Krawcheck and former SEC Chairman Arthur Levitt — and supported by at least one high-level Goldman Sachs guy — has broken through a major barrier to doing business with RIAs. Gold Bullion International LLC, founded in 2009 amid a dramatic gold boom with the intent to bring better technology, liquidity and transparency to gold transactions, has now signed a deal that will allow (mostly) independent-broker-dealer reps who use Envestnet to access investments to view their gold holdings. It’s an advance from manually loading the information and getting dated price information.
BofA’s Terry to Move to Bridgewater (The Wall Street Journal)
The giant hedge-fund firm Bridgewater Associates hired Wall Street executive Michael Terry to be a client adviser, according to people familiar with the situation. Mr. Terry joins from his post as head of global capital introductions for Bank of America Corp., a role he had for less than two years in which he introduced potential investors to hedge funds. He had previously held a similar role at Morgan Stanley, focusing on North America.
Olam Drops Defamation Lawsuit Against Carson Block (Bloomberg)
Olam International Ltd. (OLAM), the commodity trader targeted by Carson Block, dropped its defamation lawsuit against the short seller and his research firm Muddy Waters LLC, bowing to advice from shareholders to focus on its business. “After considering feedback received from several of its shareholders, Olam has decided it should now move forward and focus resources and management attention to deliver value for its continuing shareholders and stakeholders,” the world’s second-largest rice trader said in a statement to the Singapore stock exchange today.
Hansen’s Valiant Capital Posts Another Quarterly Loss (Institutional Investor’s Alpha)
Perhaps Christopher Hansen should devote more time to his hedge fund. The founder of Valiant Capital Management, together with Microsoft’s Steven Ballmer, earlier this year formalized an offer to buy a controlling interest in the Sacramento Kings professional basketball team and move the team to Hansen’s Seattle hometown. The proposed relocation is pending approval by the National Basketball Association, but in the meantime Hansen’s global hedge fund has posted its second straight disastrous quarter. Valiant lost about 10 percent in the first quarter, booking losses in each of the three months, according to investors. Valiant was down 4.1 percent in January, down 3.6 percent in February and down 1.7 percent in March.
SAC’s Martoma Gets New Lawyer (FINalternatives)
Mathew Martoma, the former SAC Capital Advisors portfolio manager accused of insider-trading, has changed lawyers. Martoma hired Richard Strassberg of Goodwin Procter to replace Charles Stillman, who had represented him since his arrest last year. It is unclear whether the switch indicates any change in Martoma’s legal strategy; he has pleaded not guilty and refused entreaties to cooperate with prosecutors in building a case against SAC founder Steven Cohen.
Freeh Says Corzine’s Risky Strategy Helped Fell MF Global (Bloomberg)
Former MF Global Holdings Ltd. (MFGLQ) Chairman and Chief Executive Officer Jon S. Corzine helped accelerate the futures brokerage’s demise with risky business strategies and mismanagement, according to a report by bankruptcy trustee Louis Freeh. The 124-page report blames Corzine and his management team for bungling an expansion of the company’s traditional business model while ignoring deficiencies in its risk controls. Corzine’s “aggressive trading strategy” that invested heavily in European sovereign debt produced no significant revenue, and he and Chief Financial Officer Henri Steenkamp knew that the company’s controls were flawed as early as May 2010, according to the filing yesterday in U.S. Bankruptcy Court in Manhattan.
