Editor’s Note: Related tickers: Citigroup Inc (NYSE:C), Goldman Sachs Group, Inc. (NYSE:GS), Herbalife Ltd. (NYSE:HLF), Sony Corporation (ADR) (NYSE:SNE), Apache Corporation (NYSE:APA), Chesapeake Energy Corporation (NYSE:CHK), Hess Corp. (NYSE:HES), BT Group plc (ADR) (NYSE:BT), Virgin Media Inc. (NASDAQ:VMED), BlackRock, Inc. (NYSE:BLK), Barclays PLC (LON:BARC)
The veteran investor’s private equity fund Quantum Strategic Partners has backed the infrastructure effort. Hyperoptic is extending its fibre optic cables all the way into homes, allowing it to provide internet access at one gigabit per second, more than 10 times faster than the fastest packages on offer from BT Group plc (ADR) (NYSE:BT) and Virgin Media Inc. (NASDAQ:VMED). BT Group plc (ADR) (NYSE:BT)’s ongoing superfast broadband upgrade takes fibre optic cables only as far as street-side cabinets, with the final hop into homes along traditional copper phone lines that slow internet access. The cash injection from Mr George Soros increases the capital available to Hyperoptic more than six-fold. It will use the money to extend its network outside London, where it has so far covered 20,000 homes in large blocks of more than 200 flats where economies of scale justify investment.
Citi wins hedge fund admin mandate from NWI Management (BobsGuide)
Citigroup Inc (NYSE:C) has won a new mandate to provide hedge fund administration and technology processing support services to New York-based investment adviser NWI Management (NWI). The mandate covers private investment funds currently totalling over $3.1 billion in assets. NWI managed a total of over $4.2 billion in assets as of May 1, 2013 for funds and accounts that generally follow discretionary global macro strategies with a focus on emerging markets. “As a premier global financial institution, Citigroup Inc (NYSE:C) has been a key business partner for NWI since our inception, and we value their expertise across a wide range of asset classes,” said Hari Hariharan, chief executive officer (CEO) and chairman of NWI. This new mandate builds upon that successful relationship.”
Oil Revolt Generates $35 Billion as Icahn-Singer Agitate: Energy (BusinessWeek)
Apache Corporation (NYSE:APA) isn’t waiting for Carl Icahn to tell the energy company how to reverse a two-year decline that’s erased $14 billion from its market value. …Farris, 65, is taking the medicine before an activist investor demands it, as Icahn did at Chesapeake Energy Corporation (NYSE:CHK) and Paul Singer at Hess Corp. (NYSE:HES) Those two are among eight energy companies with shareholder revolts whose average gain after activism commenced was quadruple the return on the Russell 3000 Energy Index, according to data compiled by Bloomberg. That added $35 billion to their combined market value.
Goldman’s Mutual Fund of Hedge Funds targets 401(k) and individual portfolios (HedgeCo)
Goldman Sachs Group, Inc. (NYSE:GS) announced it was launching the Goldman Sachs Group, Inc. (NYSE:GS) Multi-Manager Alternatives Fund. This new mutual will invest directly in hedge funds which up until now have been only available to Accredited Investors. The fact sheet states the goal of the fund is to provide “Exposure to alternative and nontraditional investments with the liquidity and convenience of a mutual fund.” and goes on to state “Once available only to institutional investors, alternative investments are increasingly used by individual investors seeking to diversify their returns and reduce portfolio risk. The Fund combines a wide range of strategies including Equity Long/Short, Dynamic Equity, Event Driven & Credit, Relative Value, Tactical Trading and Opportunistic Fixed Income.”
RI paid millions to hedge-fund managers (GreenwichTime)
Rhode Island paid hedge-fund managers almost $16 million in fees during 2012 to manage the state’s $1 billion hedge-fund portfolio. The figures were released Wednesday by General Treasurer Gina Raimondo in response to requests from the media for information about the funds, which make up about 26 percent of the state’s pension investments. The Providence Journal reports (http://bit.ly/18kcSEl) the data shows the state paid six managers more than $1 million each in the six months leading up to the June 30, 2012 end of the fiscal year. The state began moving money into the funds in November, 2011.
Diamond Said to Weigh Backing Barclays Alumni in Venture (Bloomberg)
Robert Diamond, who stepped down as head of Barclays PLC (LON:BARC) last year amid a rate-rigging scandal, is considering backing a firm started by former executives at the bank’s investment unit that was acquired by BlackRock, Inc. (NYSE:BLK) in 2009, according to a person familiar with the matter. Diamond, in one of his first moves since resigning after Barclays’s 290 million-pound ($436.2 million) fine for manipulating global interest rates, is in talks to provide capital to Incapture LLC, according to the person, who asked not to be identified because the information isn’t public. The one-year-old firm is planning to start investment strategies including a hedge fund supported by technology it’s developed.
Montgomery County Employees picks Aberdeen, Albourne America (PIOnline)
Montgomery County Employees’ Retirement System, Rockville, Md., hired Aberdeen Asset Management to run $125 million in active global equity and Albourne America as hedge fund consultant, and committed $29 million to private equity in the three months ended March 31, according to a quarterly report on Wednesday. Hedge fund consultant Albourne was hired “to assist staff with further implementation of the opportunistic program,” the report stated. Linda Herman, executive director, was not available for further details about the selection of Aberdeen for global equity.
Australia vows improved hedge fund disclosure, seeks recognized definition (Opalesque)
Australia’s market regulator, the Australian Securities and Investments Commission (ASIC), said it would allow submissions from industry players to better define “hedge funds.” The order was given on concerns that the current definition affected a number of funds that do not exhibit the same risks to investors as ‘true’ hedge funds, ASIC said in a statement. Currently, Australia has no universally recognized definition of a hedge fund. ASIC already sought two consultations on the definition in the context of seeking input on appropriate investor disclosure by hedge funds.
Sides staring each other down as deadline nears in SAC insider-trading case (WashingtonPost)
All sides are playing hardball as the deadline to bring criminal charges against Steven A. Cohen nears, with only two months left for the government to snag the hedge-fund industry guru in what it describes as the most lucrative insider-trading scheme it has pursued. The clock started ticking in July 2008, when one of Cohen’s portfolio managers allegedly got secret tips about the results of a clinical trial involving an Alzheimer’s drug, enabling the hedge fund and others to make more than $276 million.
Spidey to Swing Away from Sony? (DenOfGeek)
In a tantalizing bit of geek movie news, The Financial Times and Reuters report that Sony Corporation (ADR) (NYSE:SNE) investors are seriously considering selling large swaths of their media entertainment empire. With reports that Sony Corporation (ADR) (NYSE:SNE) CEO Kazuo Hirai is bringing a proposal by Daniel Loeb, founder of the Third Point hedge fund and the largest shareholder on Sony Corporation (ADR) (NYSE:SNE)’s board, up for serious discussion, the future of Spider-Man, James Bond and other icons in the Sony Corporation (ADR) (NYSE:SNE) stable are coming under a cloud. In Loeb’s proposal, submitted last week, the Japanese company would revitalize its sagging electronic branch by putting 15 to 20 percent of its film and music divisions up for public offering, thereby creating a wholly new entertainment firm.
Occitan To Close Amidst Losses (Finalternatives)
Occitan Capital Partners is closing its doors after less than three years in business. The London-based hedge fund has returned most investor capital and will close within a few months, Financial News reports. Firm founders Herve Gallo and Thomas de Garidel-Thoron elected to pull the plug earlier this year, after losing money in both 2011 and 2012, including a 14% drop in the latter. John Candillier, Occitan’s CEO, left the firm in January. “We underestimated the impact of policymakers and governments to damp the crisis, not only on equity prices but also on the regime of volatility,” Gallo and Garidel-Thoron wrote in October. “Our timing has been very off, making these positions painful.”
Investment bank North Street Group acquires fund administrator Hedge Fund Solutions (Opalesque)
North Street Group, a capital markets and investment banking firm, today announced the acquisition of Hedge Fund Solutions, LLC, a New York based Alternative Asset Service Provider. Additionally, North Street Group announced the name change and rebranding of Hedge Fund Solutions, LLC to North Street Global Fund Services, LLC. Terms of the agreement were not disclosed. Hedge Fund Solutions offers industry leading fund administration for both emerging and established alternative asset managers. “The strategic acquisition of Hedge Fund Solutions, LLC allows North Street to enter the alternative asset management space and expand its service offerings,” said Alex Mascioli, Managing Partner of North Street Group.
Let’s Get Serious: Investors Demand Hedge Fund Commitment (ai-CIO)
Institutional investors are demanding more commitment from their hedge funds, asking them to take fewer partners and create stronger relationships, research has claimed today. The Alternative Investment Management Association (AIMA) Investor Steering Committee noted pensions and other large asset owners wanted hedge funds to partner with a smaller crowd and work more strategically together. In this regard, the committee also reported that institutional investors were using hedge funds as a tailored addition to a portfolio, rather than allocating to them as a specific, stand-alone asset class.
Jim Rogers: Yen’s ‘Collapse Very Dangerous’ (MoneyNews)
The dollar hit a four-year high of 103.31 yen Friday, and legendary investor Jim Rogers, chairman of Rogers Holdings, doesn’t think that’s a good thing. “The [yen], which is one of the major currencies of the world, has collapsed 27 percent in no time,” Rogers told Yahoo. “It’s a very, very dangerous move.” The dollar has gained 25 percent against the yen since Dec. 4, trading early Wednesday at 102.99 yen The yen has dropped as Japan’s Prime Minister Shinzo Abe has pursued fiscal stimulus and appointed a central bank governor willing to implement a massive easing program.
A Quick Ackman-Icahn Scoreboard Check In The Battle Over Herbalife (BusinessInsider)
A quick scoreboard check in the battle of billionaire hedge fund titans Bill Ackman and Carl Icahn over nutrition supplement seller Herbalife Ltd. (NYSE:HLF)… From New York Post’s Michelle Celarier: Ackman, who once had a paper profit of $480 million, is now down $10 million, according to calculations by The Post. Icahn, on the other hand, is up $228 million, calculations show. Ackman, who runs $12 billion Pershing Square Capital, publicly said back in December that he’s shorting more than 20 million shares of Herbalife Ltd. (NYSE:HLF) with a price target of $0. He believes the company is a “pyramid scheme” and the FTC will be induced to investigate.
Unhedged Commentary: Why Training the Sell Side is So Important (InstitutionalInvestorsAlpha)
Last year, while presenting to MBA candidates at the University of Chicago’s Booth School of Business, I asked students what industry and specialty they intended to pursue after graduation. Consulting, investment management and marketing were areas of interest. Private equity was hot and investment banking remained a sought after destination. But not a single student, by a show of hands, indicated an interest in sales and trading. I suspected there would be less interest than there was a few years ago, but this was truly surprising. So what exactly is going on here? …What hedges should have worked but did not? What outside-the-box thinking proved effective? Wall Street professionals, having endured a dramatic environment for market risk over the past several years, can equip their younger colleagues with tools that better prepare them and clients for the next crisis.
