Editor’s Note: Related tickers: Hewlett-Packard Company (NYSE:HPQ), JPMorgan Chase & Co. (NYSE:JPM), Dell Inc. (NASDAQ:DELL)
Michael Dell has been advised to raise his $24.4 billion offer for Dell Inc. (NASDAQ:DELL), coming under further pressure as billionaire investor Carl Icahn revealed he had committed more than $3 billion to back an alternative proposal. The PC maker’s special committee told Dell Inc. (NASDAQ:DELL)’s founder and chief executive a few days ago that he should raise his offer if he wants it to succeed, a person familiar with the matter said on Tuesday. …Dell Inc. (NASDAQ:DELL) and Silver Lake declined to comment.
Kynikos’s Jim Chanos Is Still Waiting for HP (InstitutionalInvestor)
For two years and now going on a third, the Delivering Alpha conference – co-hosted by Institutional Investor and CNBC – has brought together the finest financial minds to discuss the pressing issues of the day and share their acute understanding of the markets. Some, like Omega Advisors founder Leon Cooperman, strike with remarkable accuracy. The soon-to-be-septuagenarian scored a perfect ten out often with his stock picks on last year’s Best Ideas panel. …Sitting alongside Cooperman and other luminaries, James Chanos laid out his best idea for 2012: Shorting the stock of PC maker Hewlett-Packard Company (NYSE:HPQ) Since Chanos took the Delivering Alpha stage and called Hewlett-Packard Company (NYSE:HPQ) “the ultimate value trap,” the company’s stock has jumped almost 30percent, from $19.30 to about $25.
Courts approve JPMorgan’s settlement with MF Global; ex-customers could get more money back (WashingtonPost)
New York judges have approved a settlement between MF Global and JPMorgan Chase & Co. (NYSE:JPM), which could clear the way for former customers of failed MF Global to get more of their money back. The settlement was first announced in March, and its approval on Wednesday was largely a formality. Previously, the courts have said the settlement would be worth about $546 million: JPMorgan Chase & Co. (NYSE:JPM) will pay to reimburse customers, and will also relinquish claims on other funds. …JPMorgan Chase & Co. (NYSE:JPM) had held MF Global funds in several accounts and also processed the firm’s securities trades.
BlueCrest’s BlueTrend hedge fund suffers 16.9 percent slump (FoxBusiness)
BlueCrest Capital Management‘s BlueTrend fund, one of the world’s biggest computer-driven hedge funds, has suffered one of its worst ever peak-to-trough losses over the past six weeks. A listed feeder fund that channels capital into the $16 billion BlueTrend fund lost 16.9 percent between May 17 and June 28, regulatory filings show. The feeder fund closely replicates the performance of BlueTrend’s flagship fund, headed up by Brazilian-born Leda Braga, one of the hedge fund industry’s highest-profile women. A BlueCrest spokesman declined to comment.
FRM predicts hedge fund managers will remain well-hedged and low on performance over coming months (Opalesque)
Man Group’s $15.5bn fund of hedge funds’ business FRM’s latest Early View finds that markets over June proved the most extreme in terms of market behaviour in 2013, with both the Fed Policy and Chinese Economic Data shaking the markets. The firm writes: “Emerging Markets equities were difficult in places, with the move in US government bond yields, forcing investors to pre-price EM assets, fundamental worries and outflows all combining to result in large moves across both EM debt and equities.”
Billabong’s back-handed hedge fund compliment (BusinessSpectator)
It is tempting to see parallels between the role US hedge funds played in the recapitalisation of Nine Entertainment and the displacement of Billabong’s bank lenders by two US funds, one of them a key player in the Nine saga. At this point, however, there is at least one fundamental difference. When Nine fell into the clutches of Oaktree Capital and Apollo Global Management last year, all the equity, and then some, had long been wiped out. The negotiations which ultimately led to the hedge funds acquiring control of Nine were between the funds and mezzanine debt holders owed more than $1 billion, who ended up with about 10 cents of value in the dollar.
Expected Rotation Out of Bonds Rattles Hedge Funds (CNBC)
A mass investor rotation out of bonds, expected earlier this year, has finally materialized—to the dismay of some hedge funds that say they now need bigger cash stashes and an increased appetite for risk in order to trade successfully. During the month of June, fixed income allocations fell to a four-year low, according to the American Association of Individual Investors, as major bond fund managers like Pimco experienced record withdrawals for the second quarter. That pullback sent places like emerging markets and high-yield bonds reeling—just as the Federal Reserve signaled plans to taper its easy-money policies within the coming years. Benchmark bond yields ticked up on that news, and in an unexpected twist, the stock market nosedived as well.
SEC to Vote July 10 to Lift U.S. Ban on Hedge-Fund Advertising (BusinessWeek)
U.S. securities regulators are set to vote next week to lift an 80-year-old rule that prohibits companies and private funds from advertising to raise capital outside of a public offering. The Securities and Exchange Commission is required to remove the advertising ban under a 2012 law that sought to ease regulations on financing for startups and small businesses. In a nod to complaints from critics who say the change will open the door to more fraud, the SEC will also propose a separate rule during the July 10 meeting to add some investor protections and make it easier for the agency to monitor the change.
Media Spotlight: Crisis Economics by Nouriel Roubini (MortgageStrategy)
Only the other week Desert Island Discs host Kirsty Young joined the Queen in directly asking the now former governor of the Bank of England Sir Mervyn King why no one had seen the beginning of the current crisis coming. King responded that while there had been warnings, primarily there had been a misreading of the market and that all the things that had been seen as dispersing risk, the endless dicing up of debt to markets and so-called sophisticated financial markets, had actually just amplified and spread that risk on a global scale. So when US housing market tanked it dragged down everything else with it.
Caxton, Citadel Among Few to Make Money in June (InstitutionalInvestorsAlpha)
June may have been a bust all over, with most market averages — and many hedge fund managers — finishing the month in the red. However, several big-name hedge funds posted strong results or continue to enjoy very good years. One of this year’s top performers is Caxton Global Investment, the fund founded by Bruce Kovner and taken over by Andrew Law in January 2012 and run out of New York-based Caxton Associates. The macro fund was up 2.25 percent in June alone and is now up 15.9 percent at the year’s halfway mark. It is not clear which markets Law made money from or exploited.
Whitebox Advisors searching for new president (PIOnline)
Jonathan Wood, president and chief operating officer of hedge fund manager Whitebox Advisors, will leave the firm within the next three to six months. Whitebox, which has $2.2 billion under management, has begun a search for a new president, confirmed Amara Kaiyalethe, a company spokeswoman in an e-mail. Mr. Wood will leave to launch a non-profit, Charity Aware, in Woodbury, Minn., to encourage teen volunteerism, he said during an interview. Mr. Wood’s dual roles are being split, said Andrew Redleaf, CEO, in a client letter obtained by Pensions & Investments.
