Hedge Funds

Capital Calls: Buyout loans

23 May 2023

Concise views on global finance: The termination of broadcaster Tegna’s sale to Standard General lets banks off the hook for funding some $8 bln in buyout debt, but clearing the pile of hung loans is just one part of the leveraged finance problem for big lenders.

Capital Calls: Man Group

11 May 2023

Concise views on global finance: The 2.5 bln pound hedge fund manager has appointed insider Robyn Grew as its first female chief executive, replacing retiring boss Luke Ellis.

Italy’s corporate power grab nears expiry date

18 Apr 2023

Premier Giorgia Meloni promised to rely on merit to pick new directors at state-backed firms like $54 bln Eni and $7 bln Leonardo. Instead, she’s stuffing boards with loyalists. Hedge fund efforts to push back at $64 bln green star Enel are a reminder the market also has a say.

Cellnex could use an outsider with a sharp knife

30 Mar 2023

Hedge fund TCI has accused the Spanish tower operator of “mishandling” an ongoing CEO search. Once an M&A machine, the $27 bln firm needs to cut its debt load markedly. That requires a new boss with a fresh perspective, not an insider.

TCI’s Airbus fury may have collateral benefit

22 Feb 2023

Hedgie Chris Hohn says the plane maker’s plan to buy a 30% stake in Atos’s cyber arm will destroy value. He’s probably right, but private investors take a back seat in defence deals, where governments call the shots. His salvo might however help Airbus drive a harder bargain.

KKR can limit the pain of Elliott’s telco blitz

13 Feb 2023

The activist is disrupting the buyout group’s bid for German phone masts firm Vantage Towers. With a 5.6% stake, Paul Singer’s fund is expected to block the delisting until it gets a big payout. But unlike previous Elliott campaigns, KKR has various ways to insulate itself.

Jeff Smith makes for a substitute Warren Buffett

30 Jan 2023

The activist’s $500 mln investment backing a deal by equipment auctioneer Ritchie Bros has come under fire. His support echoes Buffett’s moves at Occidental and elsewhere. Though the Starboard boss lacks folksy shine, he might be up to playing the role in all the ways that count.

Breakup is best cure for Fresenius chronic pain

6 Dec 2022

Covid-19 disruption and staff shortages have hit the $16 bln medical group, in which activist fund Elliott owns a stake. Sold separately, its various bits could better reward investors. Flogging low-hanging fruit like hospital builder Vamed would earn CEO Michael Sen a first win.

Philip Morris and Rio’s poker faces need some work

7 Nov 2022

The $139 bln Marlboro maker and $95 bln miner have upped buyout offers to try and clinch strategically key deals. In both cases, hedge funds and minority investors called their bluff. The lesson is that bidders can’t play hardball if everybody knows they really need a deal.

Capital Calls: Philip Morris/Swedish Match

20 Oct 2022

Concise views on global finance: The Marlboro maker has raised its already pricey $16 bln offer for the Swedish seller of nicotine pouches.

Nelson Peltz makes himself accidental role model

2 Sep 2022

A listed fund managed by the agitator will wind down, after a fight by activists. The decision should let investors exit with an above-market return. Peltz may not like handing back cash, but it could strengthen his hand next time he wants another company to do likewise.

Capital Calls: Uber’s cash starts to flow

2 Aug 2022

Concise views on global finance: The $56 billion car-hailing service is growing rapidly and has started generating positive cash flow. It’s still overvalued, though.

Why is Tiger dodging family office-dom?

19 Jul 2022

Chase Coleman’s main fund has lost about 50% in the year to May. Often this would prompt others, who struggle to recoup losses, to return cash. But Tiger’s fee structure enables it to keep going. That’s a more transparent way of doing things as long as managers stick around.

AC Milan’s soccer triumph rubs off on Elliott

1 Jun 2022

The U.S. fund is selling the Serie A winner to private equity firm RedBird for $1.3 bln, nearly 5 times sales. That’s rich for a club with chronic losses. After a challenging first half and the pandemic, Elliott looks to have made a respectable return from the Italian team.

Japan bank agitator set to prove a sad point

6 May 2022

UK hedge fund Silchester wants $3 bln Bank of Kyoto and three peers to pay higher dividends using income from absurdly outsized equity stakes. It would sensibly deploy cash and put a spotlight on weak lending activities. Alas, being right in Japan is less than half the battle.

Bank bidders solve tricky German M&A puzzle

5 Apr 2022

Advent and Centerbridge revived their $2 bln Aareal deal by offering a 12% bump and letting rebel shareholders stay invested. It should work, defying the trend of failed German takeovers. The lesson is that debt-free deals with a flexible buyer stand the best chance of success.

Frozen Russia investors can copy hedge fund trick

17 Mar 2022

Many asset managers with exposure to Russian stocks and bonds have locked their funds. One solution is to park illiquid assets in a separate vehicle – a tool known as side-pocketing. But before approving the move, regulators should ensure it’s not an excuse to charge extra fees.

Capital Calls: UK bid gets hedge funds off hook

17 Jan 2022

Concise views on global finance: Private equity group Triton sweetens its offer for pharma group Clinigen to 1.3 bln pounds, raising the chances of hedge funds accepting the deal.

Capital Calls: Hedge fund fine

22 Dec 2021

Concise views on global finance: Britain’s FCA fines BlueCrest Capital 41 mln pounds, a third of the fund’s U.S. penalty.

Elliott picks low-hanging fruit with builder punt

15 Dec 2021

After a bruising battle at utility SSE, the activist is targeting British housebuilder Taylor Wimpey. Its demands are modest and its criticisms a little overdone. Still, the $8 bln company’s lacklustre shares mean other investors should back Elliott’s call for an external CEO.