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March 7, 2017
March 7, 2017
Alaska's Wealth Fund Seeks 11 Funds for InvestmentsBy Hema ParmarAlaska’s $55.4 billion wealth fund is seeking up to 11 hedge funds for allocations, following its decision in May to from its funds of hedge funds and invest in redeem managers directly.
The prefers experienced managers that have a track Alaska Permanent Fund Corp.record of producing returns of at least inflation plus 5 percent, according to public documents from its quarterly board of trustees meeting. Alaska is seeking funds with low correlation to equity markets, "appropriate" risk controls as measured by historical drawdowns and volatility and that can show they have protected capital during down markets, the from the Feb. 22-23 board meeting show.documents
Marcus Frampton, Alaska’s director of private markets, declined to comment.Alaska currently has nine managers in its program that invests directly in hedge funds.
It plans to invest a total 5 percent of the firm’s assets, or about $2.8 billion, in managers via that program, the documents said.
As of Dec. 31, Alaska had a 4.5 percent exposure to commingled funds, either directly or via the funds of hedge funds from which it is redeeming. The move to allocate to managers directly will save Alaska $15 million a year, according to the documents, as it allows the wealth fund to cut the layer of fees paid to funds of funds for making investments.
In the past seven months, Alaska has made two hedge-fund investments: a $44 million allocation to Lansdowne Partners’s equity-focused Developed Markets Fund and a $100 million investment in Pharo Management’s macro Gaia Fund, the documents said.
Alaska's hedge-fund investments, excluding separately-managed accounts, gained 4.8 percent in the second half of last year, the documents said.
Alaska is also seeking access to some of the "most sought after" funds that were previously closed to new money, according to a performance update included in the meeting documents. It is moving away from seeding new managers — an area that dragged down returns last year — and has "a very high bar" for investing in emerging managers, the documents said.
The Alaska fund manages at least 25 percent of all mineral lease rentals, royalty sales proceeds, federal mineral revenue-sharing payments and bonuses received by the state, according to its website.
Net into macro hedge funds in inflowsJanuary, according to eVestment.
Number of the Week
$1.06 Billion
Equity-focused saw a Viking Global slight loss in February, while
's equities fund gained Renaissancein the month: Returns in Brief
Macro funds run by and Prologue are closing: State Street Closures
Ray Dalio jolts asBridgewater Jon exits: Rubinstein People News
Almost three-quarters of hedge funds are creating new fee
as a result of investor structures pressure: Research
Coatue Management names long positions in Symantec and Facebook; beefs up data science and software team: Market Calls
Baupost partner faces a Blumenthaltax-fraud trial in France: Regulatory
Paul Tudor Jones pranks environmentalists at the Audubon awards gala: Over the Hedge
Quantum, CSX, NRG Energy are among companies targeted by activists this week: Activist Situations
Inside
What to Read: Quant Edition
Luring beautiful minds — Citadeljoins chasing in Two Sigma quantscampus hiring push.
Acadian to use 's Microsoft big data technology to inform wagers.
Returns in Brief
Funds Outperform Funds of Funds for First Time Since 2013
Funds of funds on average gained about 0.5 percent in 2016, compared with a 5.5 percent return for hedge funds, according to Hedge Fund Research, Inc. It's the first time since 2013 that hedge funds have outperformed funds of funds, the data show.
Hedge Funds 2 March 7, 2017
Returns in Brief
The main hedge fund at Greenlight , led by , rose 2 Capital David Einhorn
percent in February as stocks marched higher. The performance brings the fund, which mostly makes wagers on stocks, to a gain of 2 percent in 2017 after a flat January, according to an e-mail to clients last Tuesday that was seen by Bloomberg News. The fund trails the equity market in the U.S., as the S&P 500 Total Return Index climbed 6.2 percent in the first two months of this year. While Einhorn has generally outpaced peers, his performance has lagged behind the S&P each year since 2012. Jonathan Gasthalter, an external spokesman for New York-based Greenlight, declined to comment on the results.
— Simone Foxman
, Och-Ziff Capital Management Groupthe $33.7 billion publicly traded hedge fund, gained about 1 percent last month in its OZ Master Fund, according to publicfilings, dated March 2. The fund rose 3.1 percent in the first two months of the year, after returning 3.8 percent last year, the filing said. Assets under management were up about $100 million in March from $33.6 billion as of Feb. 1, the filing shows. The New York-based firm, led by
managed $43 billion as of Daniel Och,March 1, 2016.
— Hema Parmar
, the $30.6 Viking Global Investorsbillion firm run by , Andreas Halvorsenlost 0.2 percent in its flagship hedge fund last month, bringing year-to-date returns to 1.7 percent, according to a person familiar with the matter. The Viking Global Equities fund fell 4 percent in 2016, the biggest annual loss since the flagship fund’s inception in 1999, according to a letter previously seen by Bloomberg News. Rose Shabet, chief operating officer of New York-based Viking, which wagers on and against stocks, declined to comment.
— Hema Parmar
Renaissance Technologies’s equity hedge fund gained 3.5 percent last month, according to a person familiar with the matter. The Renaissance Institutional Equities Fund rose 2.3 percent in the first
two months of 2017, the person said, while the S&P 500 Index returned about 6 percent. A spokesman for the $32 billion New York-based firm, founded by
, declined to comment.Jim Simons— Hema Parmar
February Returns
Year-to-Date Returns Through February
Funds in the charts not mentioned in the accompanying text were reported in other issues of the Brief or in Bloomberg News stories. For questions, e-mail [email protected].
Hedge Funds 4 March 7, 2017
Closures
Prologue Capital, the $775 million macro hedge fund run by David
and , is Lofthouse Graham Walshclosing after more than a decade as clients pulled their money amid poor performance.
“Last year we started well but we got the big political events wrong, it’s as simple as that,” Walsh said in an emailed statement Wednesday. “We tried to secure a one-year commitment from our big investors, but that didn’t come through. The timing is unfortunate, but I fully understand investor disappointment with recent performance.”
Prologue, based in Greenwich, Connecticut, with offices in London and Miami, was founded in 2005 by Lofthouse and Walsh, former colleagues at RBS Greenwich Capital, to wager on macroeconomic trends with a focus on sovereign debt and currencies. Macro hedge funds have suffered withdrawals after years of middling performance, with managers blaming low interest rates and other central-bank policies for restricting their ability to make money.
Prologue lost 1.8 percent in 2016 and has been little changed over the previous three years, according to the statement. The fund returned an annualized 8.7 percent from 2006 to 2013. Prologue’s best years were during the financial crisis, when it returned 19 percent in 2008 and 12 percent in 2009, according to an investor letter.
About 782 hedge funds shuttered in the first nine months of last year, the fastest pace of closures since the aftermath of the financial crisis, according to the latest data from Hedge Fund Research Inc. The $3 trillion global industry has suffered a widespread backlash over poor returns and high fees, forcing some large macro firms to cut charges.
Prologue is closing as the outlook for macro funds is improving amid monetary policy divergence between leading central banks and investors allocating money to outperformers.
“Macro managers have experienced a positive start to the year," said Philippe Ferreira, a senior strategist at Lyxor Asset
Prologue to Close After Political Bets Misfire
Management in Paris. “They are likely to continue to generate gains over the next quarters as long as the macro divergence theme between Europe and the U.S. holds true. With the Fed on track to hike rates as soon as mid-Match and the U.S. dollar still trending upward, their positioning has proved right so far."
— Nishant Kumar and Saijel Kishan
shut its sole hedge State Street Corp.fund after three years and plans to shift its focus to offering similar strategies that charge less.
The firm decided to liquidate the global macro fund after a review of the alternatives business, , Lori Heineldeputy global chief investment officer at State Street Global Advisors, said in an interview. The review was spurred by last year’s purchase of General Electric Co.’s asset-management unit.
"The acquisition enabled us to take a step back and look at our complete offering in the alternatives space," Heinel said. "The macro strategy was not as compelling given how it performed in a challenging market environment."
State Street is reversing course after trying to a grab a piece of a lucrative
State Street Closes Global Macro Hedge Fund
business. Rather than offer traditional hedge funds that charge a 2 percent management fee and 20 percent of gains, the Boston-based firm will seek to replicate their strategies and charge lower fees, Heinel said.
The firm has expanded its money-management business after its active strategies shrunk and it lost ground to BlackRock Inc. and Vanguard Group Inc. in exchange-traded funds. Under Ronald O’Hanley, who took charge of the $2.47 trillion asset-management unit in 2015, State Street sought to grow its alternative investment business.
But investors have lost patience with macro hedge funds as the strategy struggled in a low interest rate environment. Even marquee firms in this arena have faced redemptions and pressure to reduce fees.
State Street, which liquidated the hedge fund at the end of October, had difficulty attracting additional assets after the bank seeded the pool with $50 million and Hartford HealthCare’s pension and endowment added $33 million.
Michael Ho, who helped run the global macro strategy, left in January. Ho declined to comment. Don Torey, who joined State Street through the GE acquisition, oversees alternatives.
— Sabrina Willmer
People News
Macro Funds See About $1 Billion in Inflows in January
Macro hedge funds started the year with $1.06 billion in net inflows after investors yanked about $10 billion from the funds last year, according to data compiled by eVestment. The industry overall had its fifth consecutive month of outflows in January, with $5.2 billion in redemptions.
Hedge Funds 5 March 7, 2017
People News
By Saijel Kishan and Katherine Burton
Dalio Jolts Bridgewater as Rubinstein Exits
Ray Dalio shook up management at his Bridgewater Associatesfor the second time within a year in a sign that the billionaire is grappling with succession planning at the world’s largest hedge fund.
Dalio said he will step down as interim co-chief executive officer next month and will remain co-chief investment officer. He also dropped a bombshell: his star hire , one of the Jon Rubinsteincreators of the iPod, will leave after 10 months as co-CEO.
In announcing Rubinstein’s exit, Dalio conceded that his plan to bring in an industry outsider — a high-profile Silicon Valley tech executive — to his $160 billion hedge fund fell flat.
“We mutually agree that he is not a cultural fit for Bridgewater,” Dalio, 67, said in a LinkedIn post.
Bridgewater, which Dalio founded more than four decades ago, is contending with lackluster performance and a series of management shuffles at the top. Last year, lost his role as co-CEO as part of a power struggle and kept Greg Jensen his position as co-CIO. Dalio is seeking to hand over responsibilities as part of his long-term succession plan at the firm, which he has said is a tough place to work due to its unorthodox culture.
Dalio said Bridgewater President , who earlier this year was David McCormickconsidered for a post in the Trump administration, will move into the co-CEO role with
. They’ve both worked at the firm for eight years. Dalio is sharing the CIO Eileen Murraypost with Jensen and , another Bridgewater veteran.Bob Prince
"I’m excited about this change and expect to remain a professional investor at Bridgewater until I die," Dalio said in the post Wednesday. “Or until those running Bridgewater don’t want me anymore.”
Dalio started a 10-year succession process around 2010 and plans to hand over control of Westport, Connecticut-based Bridgewater to a team rather than a single person.
Rubinstein was a longtime deputy to Apple co-founder Steve Jobs and played a key role in the company’s reemergence from near-bankruptcy to technology industry pioneer. Dalio said Rubinstein helped to plan a redesign of Bridgewater’s technology and will remain as an adviser to the firm.
Dalio runs Bridgewater according to 210 principles — everything from "Don’t try to please everyone” (No. 210) to “Don’t bet too much on anything.” He promotes “radical truth” and “radical transparency,” encouraging employees to critique each other in meetings, which are taped and archived.
“Some people love this forthright way of operating and wouldn’t want to work anywhere else, while others dislike it and leave,” Dalio said on LinkedIn.
Bridgewater’s Pure Alpha II fund has gained 1.2 percent this year, according to a person with knowledge of the returns. In 2016, it rose 2.4 percent.
The turnover rate at Bridgewater is "unusually high" within the first two years for new employees, with 21 percent leaving in the first year and another 10 percent in the next, Dalio has said. Those rates then drop off to 3 percent by the fifth year — which is “exceptionally low,” he said in a January LinkedIn post.
Also Wednesday, Dalio said , the former CEO of Danish pension Carsten Stendevadfund ATP, will be joining the firm as part of a new senior fellowship program. It will bring such individuals into Bridgewater for a year to explore its culture and share insights.
— With assistance from Katia Porzecanski
Kevin Bell, the head of credit risk at Arrowgrass Capital Partners in New York and a veteran of Saba Capital Management, has died. He was 47.
“We are deeply saddened that our friend and colleague Kevin Bell has passed away today,” Arrowgrass said in an emailed statement. “We extend our sympathies and condolences to his family.”
He died in an apparent suicide, the New York Post reported. Police, without releasing the victim’s name, confirmed a man the same age as Bell died Wednesday morning after jumping from an apartment building at 390 West End Ave. in Manhattan.
Bell was most recently head of credit risk at Arrowgrass, the U.K.-based hedge fund led by former Deutsche Bank Group AG traders Henry Kenner and Nicholas Niell. Bell joined the firm in August 2015 along with several other former employees of Boaz Weinstein’s hedge fund Saba Capital Management.
Arrowgrass was founded in 2008 and has more than 100 employees in offices in New York and London, according to the firm’s web page.
Bell joined Deutsche Bank in 1999, according to his LinkedIn , and profilein 2004 was named co-head of a new unit that traded structured products in North America. He left the bank in 2007. After that, he spent time at Citigroup Inc., where he was a managing director in structured credit products, and Ken Griffin’s Citadel. He joined Saba in 2011, according to LinkedIn.
He received a bachelor’s degree from Duke University in Durham, North Carolina, in 1991.
Bell had a wife and two daughters, the Post reported.
— With assistance from Nishant Kumar and
Chris Dolmetsch
Obituary
Kevin Bell, Executive at Arrowgrass, Dies at 47
Research
Source: Bloomberg/ Jason Alden
Ray Dalio
Hedge Funds 6 March 7, 2017
Research
By Melissa Karsh and Hema Parmar
Hedge funds are feeling the pressure from investors regarding fees, with about 72 percent creating new fee structures as a result, according to a report from Citco and HFM Global. In addition, 60 percent of the 225 global hedge-fund firms surveyed said they are now offering investors customized portfolios, including those with specific liquidity terms to attract new investors. Of the managers polled for the Hedge Fund Distribution Trends Survey 2017 in September, 19 percent said managed accounts are now the biggest source of inflows, though half still rely on traditional onshore/offshore
About 41 strategies as the main source. percent of managers said they are looking to diversify into a new strategy over the next year, with long-short equity being the most favored option at 17 percent, followed by commodity trading advisers and global macro, according to the report, released March 1.
The Trump administration presents the
biggest potential global risk this year, according to a survey of attendees at the Cayman Alternative Investment Summit, which took place Feb. 15-17. About 44 percent of the more than 200 alternative investment industry attendees named this as the biggest risk, followed by cybersecurity with 25 percent, China with 14 percent, European elections at 13 percent and Brexit at 4 percent. The investors are most bullish on 2017 returns for real estate and real assets at 40 percent, followed by commodities, equities and credit. About a third of attendees said artificial intelligence is the emerging technology that will have the most impact on the world in 2017.
A correlation between fund performance and bonuses is returning to the industry, according to the Hedge Fund Compensation Report. Of the more than 200 hedge fund employees surveyedin late 2016, those in firms that saw a return of 25 percent or more reported the highest bonus expectation for 2016 at about $179,000 versus the prior year
where those in that category had the weakest bonus expectation. "The 2016 market was marked by a sustained positive trend, making it very clear where the hedge fund industry stood relative to the broader market," according to the report. "As a result, we believe expectations were more inclined to be realistic." Still, about 61 percent of those surveyed indicated that they are unhappy with their compensation — a trend that has grown in recent years, up from 56 percent last year and 54 percent the year before that. Hiring intentions for operations, risk management, legal and research, due diligence and investor relations positions were all down slightly by the end of 2016 from the prior year, the report found. Looking at fund strategies, long-short equity emerged as the favorite for the third year in a row with 47 percent of respondents indicating that their firm is pursuing the strategy, followed by event-driven and long-only. A dedicated short strategy was the least popular for the second year in a row, the report found.
Market Calls
Hedge Funds 7 March 7, 2017
Market Calls
By Taylor Hall and Simone FoxmanCoatue Management’s largest long positions include Symantec Corp. and a legacy holding in Facebook Inc., according to a March 3 investor letter reviewed by Bloomberg News.
With 6.1 million shares, Facebook was Coatue’s largest disclosed long position as of Dec. 31, while Symantec was its 25th-largest, according to a separate regulatory filing.
Symantec is “the only security company offering a platform of products that span across the network and endpoint to protect against threats in consumer and enterprise,” Philippe
, chief investment officer of the Laffontstock-picking hedge fund, said in the letter. His flagship fund is up 6 percent this year through Feb. 28 after posting a gain of 1.2 percent for all of 2016, he wrote.
The New York-based firm is confident in the road ahead for Symantec after its recent acquisitions, the appointment of a new chief executive officer in August and as the stock continues to trade at “attractive” multiples, it said in the letter.
Regarding its Facebook investment, Coatue sees a “meaningful” upside to what the social-media company can charge advertisers and a “powerful cycle” of product development picking up steam.
Coatue, which mainly makes wagers around technology, media and telecommunications companies, said it plans to take “bold concentrated positions” in its highest-conviction long ideas in the 8 percent to-11 percent range and that its top 10 positions comprise about 70 percent of its long exposure.
The firm is taking advantage of “historically low” put option pricing to position a portion of its short portfolio to capitalize in the event of meaningful market correction, it said, adding that it's in a position to materially increase the size of its short book when the market
Coatue Management Is Long Symantec, Facebook
Market Calls, Revisited
By Hema ParmarLast March, portfolio manager said Vertu Brightlight Capital Dima RubinchikMotors was his stock pick for 2016. The U.K. automotive retailer has "a healthy balance sheet, improving margins and cheap trading at approximately 10x P/E ratio," he said in an interview published on March 15, 2016.
Since then, Vertu has fallen about 26 percent, compared with a 20 percent gain in the FTSE 100 Index.
The company remains misunderstood by the market and saw forced selling by large U.K. shareholders in June and July following the Brexit vote, Rubinchik said in an email on March 2. Brightlight increased its position in Vertu last summer, he said. The stock has gained about 39 percent since July 6, 2016, when it reached the lowest level since December 2012. "It remains extremely cheap and mispriced," said Rubinchick, who is also managing partner at the Westport, Connecticut-based global equity hedge fund.
shows signs of normalizing.In the letter, Laffont also said he is
beefing up his data science and software team and that "data science has become an integral part of our investment process."
On the effect of Trump on his hedge fund, he was less sanguine. "The three consecutive days after Trump’s election represent the three toughest performance days of my career," Laffont wrote. He blamed last year’s modest return — after gains of 8 percent through late October — on declines in mid- and large-cap
technology stocks after the U.S. presidential election in November.
Laffont said that the firm’s future money-making abilities lie in its willingness to take risk and to reinvest profits in research, something he said some "complacent" large hedge funds don’t do.
Coatue is using data science to better understand both individual companies and large trends. "For example this team has a system in place that allows us the ability to track billions of anonymized credit-card transactions," Laffont wrote.
Regulatory/Compliance
Click on chart for a live version or run on the Bloomberg Terminal.G #HF.BRIEF 76
Hedge Funds 8 March 7, 2017
Regulatory/Compliance
By Miles Weiss and Gaspard SebagA partner has been ordered to stand trial for tax fraud in France Baupost Group following a decade-long dispute between the government and the hedge fund over its real estate profits, according to a person with knowledge of the case.
Thomas Blumenthal, head of international real estate, was notified in January that a magistrate judge had charged him and other directors of two Luxembourg affiliates with criminal tax fraud, according to a Baupost filing with the U.S. Securities and Exchange Commission that month.
France has been scrutinizing investment firms that it says created Luxembourg companies to avoid paying taxes on local real estate. Baupost, the $30 billion hedge fund led by , set up an investment venture in the 1990s with the late Seth Klarmandeveloper Howard Ronson’s HRO Group that built and renovated European office buildings in London, Paris and Frankfurt through affiliates in Luxembourg.
“France is attacking every single Luxembourg entity to try and get tax, whether they are right or wrong,” said Robert Anthony, a professor of international tax law and the principal partner of Anthony & Cie, a multi-family office. “They haven’t always won.”
The French Tax Administration began auditing the Luxembourg affiliates of Boston-based Baupost funds after they sold three investments in 2006. The ensuing court fights and criminal investigation weren’t made public until the January SEC filing, although Baupost has kept clients aware of the legal proceedings since 2011.
Baupost is fighting the tax assessments in France’s highest administrative court, the Conseil d’Etat, and is backing Blumenthal in contesting the criminal case. The other directors charged with tax fraud don’t work for Baupost.
“Everyone who knows Tom understands that he is a person of the highest integrity,” Baupost spokeswoman Diana DeSocio said in an e-mailed statement. “In all instances he acted in good faith for the benefit of our clients and we fully support him in this matter.”
Blumenthal, who joined the firm in 1993 and co-heads its private investment group, declined to comment.
By Matt RobinsonUnknown traders made more than $3.6 million in illegal profits by investing in shares and derivatives ahead of Softbank Group Corp.’s announcement last month that it would buy , according to U.S. regulators.Fortress Investment Group LLC
The traders are believed to be overseas investors who used accounts outside the United States, the Securities and Exchange Commission said in a court filing. The SEC said it won an emergency court order freezing the traders’ assets.
The defendants engaged in “highly suspicious trading” that involved buying 950,000 Fortress shares through accounts at Maybank Kim Eng Securities Pte in Singapore, the SEC said in a statement last Tuesday. The stock was purchased on Feb. 14 at prices ranging from $5.92 to $6.35 a share. After the market closed that day, Softbank said it planned to acquire Fortress for about $3.3 billion, or $8.08 a share.
The asset freeze “ensures that the profits cannot be removed from the accounts while the agency’s investigation of the trading continues,” the SEC said in its statement.
The defendants also include traders who purchased derivatives representing about 1 million shares of Fortress from Feb. 10 through Feb. 14, the SEC said in a filing. The derivatives were bought from London-based R.J. O’Brien Ltd., according to the regulator.
“We are currently assisting, and extending our full cooperation to the relevant authorities investigating this matter,” Maybank said in a statement. “We wish to clarify that neither Maybank Kim Eng nor any of its employees is a party to this litigation in the United States District Court involving the securities of Fortress Investment Group.”
R.J. O’Brien “is neither a defendant in the complaint nor in any way a target of the investigation,” a spokesperson said in an e-mailed statement. The firm said it monitors for unusual trading activity and complies with obligations to notify regulators.
— With assistance from Pooi Koon Chong
Baupost Partner Faces Tax-Fraud Trial in France
Traders Said to Make Illegal Gains on Fortress Deal
A decade ago, Deutsche Bank AG pitched hedge funds at a securitization industry conference in Las Vegas on a big short. Now at the same annual gathering, it’s offering to help clean up what remains of the subprime mortgage mess.
The bank met last week with hedge funds that specialize in handling delinquent home loans and that may want financing, according to people with knowledge of the meetings. The deals could help Deutsche Bank meet some of its requirements under its $7.2 billion mortgage-bond settlement with the U.S. government, finalized on Jan. 17.
Deutsche Bank would finance the hedge funds’ purchase of defaulted loans, and investors would then ease the terms of the mortgages. The funding could count toward Deutsche Bank’s requirement under the settlement to provide $4.1 billion of relief for mortgage borrowers, according to the people.
Some of these loans may end up coming from taxpayer-backed Fannie Mae and Freddie Mac, said the people. Troy Gravitt, a spokesman for the German bank, declined to comment.
Before the housing bubble burst, Deutsche Bank traders at the conference pitched investors on shorting mortgage bonds, as chronicled in the book and movie “The Big Short.”
Business has been booming again for delinquent and soured mortgage loans that remain from the 2008 financial crisis, in part because of lenders like Deutsche Bank that are required by legal settlements to provide relief to consumers. Firms are bundling last decade’s subprime home loans into bonds, and some of the securities are performing well thanks in part to recovering home prices.
— Matt Scully
Deutsche Bank Said to Meet With Funds
Hedge Funds 9 March 7, 2017
Over the Hedge
Hedge Funds 10 March 7, 2017
Over the Hedge
Paul Tudor Jones Pranks Environmentalists at Audubon Awards GalaBy Amanda GordonJust about every award presenter this week got a laugh out of the Oscars’ Best Picture gaffe, but Paul Tudor Jonestook it to a whole new level.
The setting was the National Audubon Society’s annual gala in New York, gathering some of the nation’s leading environmentalists at tables decorated with hologram-like birds. Pete McCloskey helped pass the Endangered Species Act and co-founded Earth Day. Carol Browner led the Environmental Protection Agency and the White House Office of Energy and Climate Change Policy. The current and former heads of the Natural Resources Defense Council, Rhea Suh and Frances Beinecke, were in the room.
All these folks have reason to feel embattled, not only with glaciers melting and birds losing habitats, but in the era of President Trump. The Republican-controlled Senate is reviewing the Endangered Species Act and EPA Administrator Scott Pruitt plans to roll back Obama-era rules.
David Yarnold, the chief executive of Audubon and a former journalist, on Wednesday night acknowledged the stakes are high, and said Audubon is well-positioned to take on the necessary fights "in these interesting times," with state-based offices and membership spanning the political spectrum.
But the crowd needed levity, too. Jones delivered, taking the stage to present the Lufkin Prize for Environmental Leadership, a $100,000 award created by Dan Lufkin, co-founder of Donaldson Lufkin & Jenrette.
"In just a moment, I’ll be announcing the winner of the Lufkin Prize, that fantastic prize designed by Dan to go to those doers of good deeds, thinkers and fighters, the people actually protecting our natural resources," Jones said.
It was classic, inspiring Jones — aside from the way he was flaunting an envelope in his hand.
"Without further ado, the winner is...” He paused to tear open the paper. "Scott Pruitt, EPA. Is Scott here?"
Laughter pealed through Gotham Hall as a member of the Audubon staff ran up to the stage with another envelope. Jones quickly ripped it open.
"Nat Reed," Jones bellowed, now naming the correct prize recipient, who’d been previously announced and printed in the program. Jones then paid tribute to Reed, a compatriot of his in working to restore the Everglades, whose career stands in a stark counterpoint to Pruitt, the former Oklahoma attorney general who repeatedly sued the environmental agency he now runs.
Jones closed his remarks by quoting John James Audubon about turning to
nature for solace in adverse circumstances. "Many a time, at the sound of a wood-thrush’s melodies have I fallen on my knees," Jones said, reading a longer passage.
That quote, for Jones, summed up what has made Reed so consistent and persistent an environmentalist, showing up day after day, year after year. "You can’t just pull out arguments of sustainability or academic arguments about economic benefits," Jones said. Being an environmentalist "requires the sustenance that comes from those moments of grace that we all get when we’re alone in the woods and hear the song of a bird."
For more from Amanda Gordon's Scene Last
Night columns, run on the NI SCENCE <GO>
Bloomberg Terminal.
HFC's New York Gala Raises $1.4 Million for CharityBy Hema ParmarHelp for Children’s New York Gala raised $1.4 million for charity as more than 500 people in the hedge fund industry attended the 19th annual event on March 2, according to spokesman Mitch Ackles.
The evening took place in the American Museum of Natural History's Milstein Hall of Ocean Life and included a silent auction.
Goldman Sachs Group Inc. was honored at the event for the firm’s commitment to the charity. The award was accepted by Goldman Sachs managing director Dean Backer, who is also chairman of HFC's board of directors.
Last year, HFC donated more than $1 million to organizations working to
combat child abuse in metropolitanNew York City.
Deal Arbitrage
Source: Bloomberg/Amanda Gordon
Paul Tudor Jones and Nathaniel Reed
Source: Mitch Ackles
Goldman Sachs's Anne Black and Dean Backer at the gala
Hedge Funds 11 March 7, 2017
Target AcquirerDeal
Size ($, M)
Expected Completion
Date
Offer Per
Share ($)
Target Price
($)
Payment Type
SpreadProjected
Annualized Return
1W Change
in Spread
*Major Move
Time Warner Inc. AT&T Inc. 107,131 12/31/17 108.30 98.12 C&S 10.4% 12.6% 0.3%
Monsanto Co. Bayer AG 65,696 12/31/17 128.00 114.65 Cash 11.6% 14.2% -0.9%
EI du Pont de Nemours & Co. Dow Chemical Co. 65,603 06/30/17 81.45 79.81 Stk 2.1% 6.5% 0.3%
Reynolds American Inc British American Tobacco PLC 59,553 09/30/17 62.15 61.28 C&S 1.4% 2.5% -0.4%
Energy Transfer Partners LP Sunoco Logistics Partners LP 51,382 03/31/17 38.69 38.58 Stk 0.3% 4.0% -0.2%
Level 3 Communications Inc. CenturyLink Inc. 33,500 09/30/17 59.51 56.26 C&S 5.8% 10.1% -1.4%
Agrium Inc.Potash Corp of Saskatchewan Inc.
18,197 12/31/17 94.95 94.81 Stk 0.2% 0.2% -0.3%
Mead Johnson Nutrition Co. Reckitt Benckiser Group PLC 17,810 9/30/17 90.00 88.34 Cash 1.9% 3.3% -0.6%
ONEOK Partners LP ONEOK Inc. 17,378 6/30/17 55.76 54.93 Stk 1.5% 4.8% 0.1%
Rite Aid Corp. Walgreens Boots Alliance Inc. 14,616 7/31/17 7.00 5.23 Cash 33.8% 84.0% 17.3% ▲
Linear Technology Corp. Analog Devices Inc. 12,814 3/10/17 65.46 65.45 C&S 0.0% 1.6% -0.7%
WhiteWave Foods Co. Danone SA 12,349 3/31/17 56.25 55.06 Cash 2.2% 31.6% 0.3%
Westar Energy Inc. Great Plains Energy Inc. 12,117 12/31/17 60.00 54.89 C&S 9.3% 11.3% -1.7%
Valspar Corp. Sherwin-Williams Co. 11,206 3/31/17 113.00 111.49 Cash 1.4% 19.8% -0.2%
Cabela's Inc.Private Advantage FIC FI Multimercado
9,876 6/30/17 65.50 47.01 Cash 39.3% 123.8% 0.2%
VCA Inc.Private Advantage FIC FI Multimercado
8,793 9/30/17 93.00 91.04 Cash 2.2% 3.8% -0.1%
Harman International Industries Inc. Samsung Electronics Co Ltd. 8,651 6/30/17 112.00 111.50 Cash 0.4% 1.4% 0.1%
B/E Aerospace Inc. Rockwell Collins Inc. 8,245 3/31/17 64.26 63.86 C&S 0.6% 9.2% 0.4%
Alere Inc. Abbott Laboratories 8,040 — 56.00 38.05 Cash 47.2% 0.0% 5.0% ▲
WGL Holdings Inc. AltaGas Ltd. 6,289 6/30/18 88.25 83.50 Cash 5.7% 4.3% -0.3%
Endurance Specialty Holdings Ltd. Sompo Holdings Inc. 6,285 3/31/17 93.00 93.06 Cash -0.1% -0.9% -0.2%
Western Refining Inc. Tesoro Corp. 5,890 6/30/17 36.77 36.42 C/S 1.0% 3.0% 0.2%
Brocade Communications Systems Inc.
Broadcom Ltd. 5,551 10/31/17 12.75 12.35 Cash 3.2% 5.0% -0.2%
CST Brands Inc. Alimentation Couche-Tard Inc. 5,265 6/30/17 48.53 48.33 Cash 0.4% 1.3% 0.2%
Allied World Assurance Co Holdings AG
Fairfax Financial Holdings Ltd. 4,771 6/30/17 54.00 53.17 C&S 1.6% 4.9% -0.4%
Manitoba Telecom Services Inc. BCE Inc. 4,171 6/30/17 39.64 39.35 C/S 0.7% 2.3% -0.1%
Mentor Graphics Corp. Siemens AG 4,012 6/30/17 37.25 37.08 Cash 0.5% 1.4% 0.0%
PrivateBancorp Inc.Canadian Imperial Bank of Commerce
3,833 3/31/17 51.42 57.72 C&S -10.9% -159.2% -1.8%
Radius Health Inc. Shire PLC 3,651 — 90.00 42.11 Cash 113.7% 0% 3.7% ▲ MARB <GO> North American deals
*Spread moved by more than 2% of price target: = up, = down C/S=cash or stock▲ ▼
Deal Arbitrage
The table below tracks pending corporate mergers in North America and the deal spreads — the difference between the offer price and the target's stock price. The table shows the week-over-week change in those spreads through Monday. Spreads that have moved by 2 percent or more are flagged in the far right "major move" column by an arrow indicating the direction of movement. Projected annualized returns are based on the spread and the deal's expected completion date.
Activist Situations
Hedge Funds 12 March 7, 2017
Significant Actions at Companies Targeted by Activist Investors
COMPANY ACTIVIST WHAT HAPPENED
CSX Corp. Mantle Ridge LP
The railroad appointed Hunter Harrison as chief executive officer on March 6 in a bow to pressure from the activist investor. The board will include three directors agreed on by the company and the activist, according to a statement. (Web link)
Quantum Corp.Viex Capital Advisors
The computer hardware and storage company into an agreement with the activist, which has a 10.9 percent stake as of Feb. 2, to enteredreconstitute its board of directors "over the next several months,” according to a March 3 statement. The company will identify three new independent directors within 90 days, subject to the activist's approval.
Immunomedics Inc.
VenBio Select Advisor LLC
The activist investor in a March 3 statement that it won all four board seats sought in a shareholder vote over its proxy fight at the saidbiotechnology company.
Arconic Inc.Elliott Management Corp.
The jets- and auto-parts maker under attack by the activist investor in a statement March 2 that it is submitting a proposal to change its said board structure. The New York-based company will seek shareholder approval to declassify the board structure, eliminate a super-majority vote and amend company by-laws to provide eligible shareholders with a proxy access mechanism to nominate director candidates, it said in the statement.
Taubman Centers Inc.
Land & Buildings Investment Management
The Michigan-based company a board proxy fight after the activist investor nominated two dissident candidates to replace key directors facesup for a vote at the mall owner’s next annual meeting. In a statement March 2, the activist refers to “transgressions,” including moves to solidify family control and the 2003 rejection of a takeover offer by Simon Property Group Inc., and also blames “sub-par returns” on “poor capital allocation, bloated G&A, inferior operating margins and abysmal corporate governance.” In a separate e-mailed statement, the company said it has a highly qualified and independent board, noting two new directors appointed last year, and said the family had maintained about 30 percent ownership of the company’s operating partnership “ensuring the alignment of its interests” with other shareholders.
NRG Energy Inc.
Elliot Management Corp.
The extent of the energy company’s to shed assets and cut costs may not be known for months as the power producer begins a strategic bidreview after appointing two activist board members earlier this month, according to a Feb. 28 conference call with investors.
Source: Bloomberg News, , NI SHRHOLDACT <GO> BI BESG <GO>Note: Links go to stories on the Bloomberg Terminal, unless otherwise noted
This table was compiled by Bloomberg LP employees involved with data collection and was edited by the News department. To suggest ideas or provide feedback, contact the editor for this table: Melissa Karsh at [email protected].
— Michael Thieme and Jason Martino, Bloomberg Data
Bloomberg Briefs: Hedge Funds
Activist Situations
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Hedge Funds 14 March 7, 2017
DATE ORGANIZER EVENT SPEAKERS/ATTENDEES OF NOTE/DETAILS LOCATION
March 7 Access-Alts Asia Asia-Global Hedge Fund SummitDonald Tang, D.E. Shaw; Trilogy; John Sitilides, Marc
Avenue Capital; Protege; Lasry, Michael Weinberg, Ethan Devine, Indus; Samuel Belk, Cambridge.
The Pierre, New York
March 20 AIMANavigating Private Placement Regimes Around the World 2017
Presentation and panel sessions focusing on individual countries.
New York
March 21-22 InvestOps Trade Tech Invest Ops 2017April Wilcox, Calstrs; OMERS; Henry Jenny Tsouvalis, Kravchenko, Marshall Wace; Tiffany Fleming, Prudential IM.
Tampa, Florida
March 22 Markets Group ALTSLA 2017
Dick Pfister, AlphaCore; LA Employees Bryan Fujita,Retirement System; Michael Wu, GenSpring; Jim Burritt, Pacific Life; San Bernadino Employees Donald Pierce,Retirement Association.
Omni Hotel, Los Angeles
March 30 Talking Hedge Emerging Managers & DiversityKenny King, JPMorgan; Paamco; Judith Posnikoff, Ron
Lomas Capital; Policemen's McIntosh; Aoifinn Devitt, Annuity and Benefit Fund of Chicago.
UBS Tower, Chicago
April 3 CatalystCap Intro: Credit/Fixed Income Alternative Lending
Investment manager and investor meeting. New York
April 4 Joint Venture Events Group3rd Annual Liquid Alternatives Strategies Summit
Yung Shin Kung, Quantitative Investment Strategies; Dick Pfister, AlphaCore; Anton Schutz, RMB Funds.
New York
April 4 Markets Group Alts Investor Forum South Teacher Retirement System of Texas; Steven Wilson, Ed
Chapwood Investments. Butowsky,Dallas
April 4 American Conference Institute4th AML, Sanctions &FCPA Summit for Private Equity and Hedge Funds
To be released. New York
April 5 Talking HedgeThe Modernization of Due Diligence for Alternative Investments
Lionel Erdely, Investcorp; Rothschild; Steven Shakil Riaz, Kahn, Talpion; Glenmede; Benjamin Alimansky, Alessandra Tocco, JPMorgan.
Harvard Club, New York
April 13 Hedge Funds Care San Francisco Benefit Contact Rachel Wheeler at [email protected] for more information.
San Francisco
April 20 Context Summits NYC 2017 One-on-one meetings with investors. New York
April 23-26 informa GAIM Ops CaymanMark DeGaetano, KKR Prisma; Samantha Greenberg, Margate; Elizabeth Madden, Davidson Kempner; Steve Metzger, Two Sigma; Mark Schein, York Capital.
Ritz Carlton, Grand Cayman
April 27 13D Monitor Active-Passive Investor Summit
Alex Denner, Sarissa; Blue Harbour; Clifton Robbins, Jeff Smith, Starboard; Mick McGuire, Marcato; Ed Garden, Trian Partners; Keith Meister, Corvex; Paul Hilal, Mantle Ridge.
Plaza Hotel, New York
May 3 Hedge Funds Care 15th Annual Chicago Benefit Contact Rachel Wheeler at [email protected] for more information.
Chicago
May 8 Sohn Sohn Investment Conference To be released. New York
May 15 CatalystCap Intro: Alternative Investing Funds West
Investment manager and investor meetings. San Francisco
May 16-19 SkyBridge Capital SALT
Bill Ackman, Pershing Square; Third Point; Dan Loeb, Jim Kynikos; Hayman Capital; Chanos, Kyle Bass, Troy SkyBridge; Canyon Partners; Gayeski, Joshua Friedman,
CQS; Saba; Michael Hintze, Boaz Weinstein, Roslyn CIC.Zhang,
Las Vegas
June 13 Markets Group Alts Investors Forum WestGreg Irlbeck, Dallas Police & Fire Pension System; Justin
Covenant Multi Family Offices; Satori Pawl, Darsh Singh, Alpha.
San Francisco
June 19 CatalystCap Intro: Multi-Fund FinTech Platforms
Investment manager and investor meetings. New York
DISCLAIMER: The information on this page was compiled by Bloomberg from multiple sources, public and private, and is deemed to be accurate, but not definitive or exhaustive. Questions about events should be addressed to the event organizer.
Calendar
To submit an event e-mail [email protected]. The "event" column links to websites. "Attendees of note" links to individual's BIO page, where available, on the Bloomberg terminal.
