Sears Cuts 115 Corporate Jobs as It Works to Reduce Expenses (Bloomberg)
Sears Holdings Corp., the retailer run by hedge fund manager Edward Lampert, eliminated about 115 corporate jobs to cut costs after three years of losses. Approximately 100 jobs were cut at the retailer’s headquarters in Hoffman Estates, Illinois, and 15 positions were eliminated elsewhere, Howard Riefs, a spokesman, said today in an e-mail. Lampert, the retailer’s chairman and chief executive officer as well as its largest shareholder, has been shutting stores and getting rid of assets such as the Lands’ End clothing business while trying to boost sales to rewards program members. Sears has continued to struggle, posting $5.44 billion in net losses in the past three years and $1.52 billion in the first three quarters of the current fiscal year.
Bill Ackman on Receiving End of Hedge Fund Selling (The Wall Street Journal)
Hedge fund activist Bill Ackman is used to calling the shots at the listed companies he frequently targets. So there is a certain irony in the fact that it is other hedge funds, he says, who are responsible for driving down the price of shares in his $5.8 billion listed firm, Pershing Square Holdings — a situation he calls a “disappointment.” Mr. Ackman, known for among other bets a long-running short position on Herbalife, and holdings in stocks such as Allergan Inc.AGN -0.45% and Zoetis Inc.ZTS +1.04%, raised $2.7 billion from new investors via a listing of the investment vehicle on the Euronext Stock Exchange in Amsterdam last year.
In DuPont Fight, Activist Investor Picks a Strong Target (New York Times)
Shareholder activism is in full roar as hedge funds prowl and companies retreat, but Nelson Peltz’s campaign to replace four directors at DuPont may just be where corporate America finally draws the line and tries to stem the activist tide. Activists are flush with money from investors who have found that activism works at prodding companies to improve their bottom lines — more than 400 funds now have more than $100 billion, according to estimates by Preqin — and they have been searching far and wide for targets. DuPont is one of the most prominent. In August 2013, Mr. Peltz’s hedge fund, Trian Fund Management, announced that it had taken a stake in DuPont, one that would grow to 2.7 percent. Trian called for a breakup of DuPont while also arguing that it could cut $4 billion in expenses.
Highfields Clients Said to Pull 3% of Assets at Year-End (Bloomberg)
Highfields Capital Management, the investment firm run by Jonathon Jacobson, told clients at year-end that it expected redemptions equaling about 3 percent of its $12.5 billion in assets. The redemptions, which would be about $375 million, come after Boston-based Highfields posted low single-digit returns last year, said the people, who asked not to be identified because the information is private. The firm is closed to new investments and returned about 15 percent of capital to clients in 2013 after it gained 27 percent that year.
Hedge Fund Barington Proceeds With Proxy Contest at OMNOVA: Filing (Reuters)
Hedge fund Barington Capital Group filed preliminary proxy statements with the U.S. Securities and Exchange Commission and is proceeding with a proxy contest to elect three alternative directors to the board of OMNOVA Solutions, the documents show. New York-based Barington, which controls 2 percent of Beachwood, Ohio-based OMNOVA (OMN.N), a maker of specialty chemicals, nominated its slate in December and filed documents with the SEC late on Tuesday.
Engaged Capital Scores Quick Win with Silicon Image (The Wall Street Journal)
Engaged Capital LLC, the Newport Beach, Calif.-based activist hedge fund, is on a roll. In an otherwise quiet day for deals, Lattice Semiconductor Corp.LSCC -2.60% on Tuesday announced a $600 acquisition of a rival semiconductor producer Silicon Image Inc.SIMG -0.21%. Silicon Image’s sale comes a little more than a month after Engaged Capital disclosed that it had increased its stake in the company to 5.2% and wrote a letter to the board of directors, calling it undervalued and outlining potential steps to take to increase the share price.
Hedge Funds Earned $1.5 Trillion For Investors in Last 10 Years (Reuters)
Hedge funds earned $1.5 trillion for their investors over the last ten years and more pension funds are increasing the amount of money they allocate to them, trade body Alternative Investment Management Association (AIMA) said on Wednesday. The findings, based on data from industry tracker HFR, come as hedge funds face intense scrutiny following decisions by funds such as the California Public Employees’ Retirement System and Netherlands’ PFZW to pull out of them, citing high costs, complexity and poor performance.
Here Are The Best Hedge Funds For 2015: Experts (CNBC)
Nervous about stock prices being too high, bond yields being too low and cash doing nada? Then hedge funds may be right for you. That’s the pitch investors in the asset class are giving to their own clients—even as the average hedge fund manager underwhelmed in 2014 with a 4.21 percent average return, per HedgeFund Intelligence. “We think hedge funds going forward make a lot of sense in the portfolio given how equities and bonds have traded over the last several years,” Robert Duggan, a portfolio manager at $12.5 billion SkyBridge Capital, said in a recent video to accompany a white paper this month, “Why Investors Should Allocate to Hedge Funds.”
Dalton Fund Manager Readies March Launch For Asia Hedge Fund (Reuters)
Former Dalton Investments portfolio manager Tony Hsu is preparing to launch his own hedge fund in March to bet on shares of entrepreneur-led Asian firms and against state-run companies, according to a source and the fund’s marketing material. Hsu, who led a team that invested $2.5 billion for Dalton before leaving the firm last year to set-up OTS Capital in Hong Kong, will start trading with about $100 million, the source with direct knowledge of the matter said. The fund has capacity to take in $1 billion.
