PineBridge partners with CICC Investment Management to Launch first global fund of hedge funds (AmeInfo)
CICC Investment Management (USA), Inc. and PineBridge Investments LLC (PineBridge) announced the launch of the first global fund of hedge funds (Fund) on April 1 targeting qualified Chinese investors. The launch of the global fund of hedge funds demonstrates the strategic decision of CICC Investment Management (USA)’s parent company, China International Capital Corporation Limited (CICC), to expand its investment management business globally. PineBridge and CICC Investment Management (USA) have both invested proprietary capital to seed the Fund and ensure alignment of interests with investors.
Buffett To Hedge Fund Manager: ‘You Didn’t Convince Me To Sell The Stock’ (BusinessInsider)
Weeks ago Warren Buffett called on investors far and wide to be the “credentialed bear” at his Berkshire Hathaway Inc. (NYSE:BRK.A)’s massive annual shareholder blowout in Omaha. Ultimately, Palm Beach hedge fund manager Doug Kass was selected, and as “credentialed” bear he got to ask the first question in front of thousands of onlookers today. That’s probably tough. After Berkshire announced earnings yesterday and blew past analyst earnings by $307 a share, it was probably even more tough. All that said, Kass opened with a valid question, and not one that isn’t unheard of when people whisper criticism of Buffett’s legendary firm — they ask if in recent years his acquisitions have become too large.
Soros and Dell back Waypoint helicopter leasing group (FT)
The funds of two of the world’s highest-profile individual investors – Michael Dell and George Soros – are betting on future high levels of offshore oil production by investing hundreds of millions of dollars in a helicopter leasing company. Waypoint Leasing is one of only two significant lessors of helicopters, alongside Ireland’s Milestone Aviation, and plans to build up a fleet of up to about 65 aircraft. The fleet will mainly be aimed at meeting fast-growing demand for helicopters to ferry workers to and from offshore oil and gas platforms, which are gradually moving further from land. Mr Dell’s family investment vehicle, MSD Capital, and Mr Soros’s private vehicle, Quantum Strategic Partners, are the two biggest investors of three that have invested $375m in Waypoint. Two people involved said both MSD and Quantum had taken equal stakes, while a third investor, Cartesian Capital, had taken a smaller stake. The firms are expected to announce the investment formally early this week.
Icahn, Southeastern Eye Board Fight Over Control of Dell (FoxBusiness)
After backing off from a potential bidding war over Dell Inc. (NASDAQ:DELL), billionaire investor Carl Icahn reportedly plans to join forces with the PC maker’s largest outside shareholder in the next week to force a board fight. A proxy fight between Icahn and Dell Inc. (NASDAQ:DELL) anagement would be the latest drama since founder and CEO Michael Dell unveiled a $24.4 billion leveraged buyout in February in a deal with private-equity firm Silver Lake Partners. According to the New York Post, the board fight could be a prelude to Icahn and Southeastern Asset Management calling on Dell Inc. (NASDAQ:DELL) to unload parts of its business and pay shareholders a dividend by repatriating about $9 billion in overseas cash. Both Icahn and Southeastern, Dell Inc. (NASDAQ:DELL)’s largest outside shareholder, have criticized the $13.65-a-share LBO from Michael Dell as being too cheap.
Dr. Doom: Buy stocks while you still can (HartfordBusiness)
The famously gloomy economist Nouriel Roubini has finally fingered an investment he likes. But his advice carries an expiration date. Roubini is predicting an uptick in stock prices over the next two years as the Federal Reserve continues its stimulus efforts. But buyer beware, Dr. Doom says, because a day of reckoning is lurking at the end of the two-year horizon. Roubini, an economics professor at New York University best known for predicting the U.S. housing crisis, thinks the Federal Reserve and other central banks around the world can and will prop up stocks and bonds for the next two years.
This Accounting Quirk Is Setting Up Public Pensions For Disaster (BusinessInsider)
The Economist has an interesting piece in Buttonwood this week about how U.S. public pensions do their accounting. Basically, they discount their liabilities using the expected return on their assets. …This perverse accounting treatment got me thinking about why pension funds continue to invest in hedge funds seeking 8% returns, even though it’s been many years since hedge funds made 8% and it’s not likely they will in the near future either. Certainly not with over $2 trillion competing for opportunities. Based on the accounting, including an asset with an 8% return target helps reduce the value of their liabilities even if the 8% return expectation is an unreasonable expectation. So the motivation for a pension fund trustee could be to include hedge funds because of their helpful impact on the discount rate on their liabilities even while their continued failure to achieve that target doesn’t cause huge immediate problems.
