redemptions or lack thereof

  • 04 Oct 2013 at 1:08 PM

Pershing Square Investors Standing By Their Man

William Ackman’s bad year is taking a big toll. The activist hedge-fund manager has seen his firm’s assets under management decline by $1.2 billion from a high point earlier this year, largely due to investment declines, according to people familiar with its operations…At the end of September, Pershing Square’s total assets under management stood at $11.2 billion, according to a person familiar with the matter. That is a $1.2 billion decline from the $12.4 billion that Pershing Square reported it had under management as of March 1 in a filing with the Securities and Exchange Commission…People with knowledge of the firm said the decline resulted almost completely from weak investment performance, and net redemptions by investors had amounted to less than $150 million so far in 2013. [WSJ]

Nobles Crus, a struggling wine fund listed in Luxembourg, has been forced by the grand duchy’s financial regulator to bar its investors from withdrawing their money and also can no longer sell its shares after running out of cash. The decision by the Commission de Surveillance du Secteur Financier (CSSF) to “temporarily suspend all redemptions and subscriptions” in Nobles Crus came late last month after Elite Advisers, the fund’s managers, admitted they did not have enough cash on hand to meet redemptions “involving considerable sums of money”. Revelations about the fund’s illiquidity follow some of Nobles Crus’ rivals as well as valuation specialists questioning the method by which Elite Advisers calculate the month-on-month increase in the prices of the fund’s bottles. It also coincides with a fall in Nobles Crus’s assets, which slid from €109m in September of last year to €91m at the close of March. The fund revealed the news about its failure to meet redemptions in a letter sent to investors at the start of June. The note implies that a reason behind the spate of redemptions the fund endured are European-wide regulatory changes which make it impossible for Ucits funds to invest in specialised investment funds such as Nobles Crus from the start of next year.[FT]

Was 2011 a very kind year to John Paulson? No, it was not. Is 2012 shaping up to be any different? Not really, no. His proclamation that last year’s losses were but an “aberration” has not exactly been backed up by the fact that AP was down 16 percent through June.  A few clients have not only quit the fund but told anybody who will listen that leaving was one of the best decisions they’ve ever made. Also not great is the fact that assets under management have declined 44.9 percent to $21 billion from $38.1 billion, due to a combination of unfortunate performance and redemptions. Happily, though, there is a silver lining that perhaps few people have thought of, namely that John Paulson’s got mucho of his own dinero in the firm and he hasn’t given up on the place yet. Read more »

Bill Gross’s Pimco Total Return Fund, the world’s biggest mutual fund, attracted $231 million in investor deposits in January as performance rebounded. The new money ended three straight months of redemptions from Pimco Total Return, according to data compiled by Chicago- based Morningstar Inc. Investors pulled about $3 billion from the fund in the three months ended Dec. 31, bringing withdrawals last year to $5 billion, the research firm said. The $250.5 billion Pimco Total Return has advanced 2.4 percent this year, beating 99 percent of similarly managed funds, according to data compiled by Bloomberg. [Bloomberg, related]

  • 09 Dec 2011 at 3:38 PM

Phil Falcone Is Going To Hang On To That Cash For Now

Earlier this week, Phil Falcone notified investors in his Credit Distressed BlueLine Fund, in advance of a previously announced April 2012 wind-up. Today, he sent out a letter notifying investors in Harbinger Capital Fund I, Harbinger Capital Partners Offshore Fund I, Harbinger Capital Partners Fund II, and Harbinger Capital Partner Offshore Fund II that they should “anticipate” having redemptions frozen as well, on account of the Well Notice received by the SEC. Happy Holidays. [WSJ]

For about a year now, hedge fund manager Phil Falcone’s relationship with his investors has been a bit rocky. While many expressed displeasure at his decision to tie up a good chunk of money in a wireless bet that may or may not pan out, what really set a lot of people off was Falcone’s decision, last November, to loan himself $113 million from a fund in which redemptions has been suspended, in order to pay personal taxes he hadn’t set aside enough cash to cover. Since then, Phil has not only paid the $113 million back, but 1) proved he learned his lesson re: borrowing money from humorless clients (in July he failed to pay $201,101 in property taxes, which he could have loaned himself from you know who but didn’t) and 2) offered investors interested in redeeming the opportunity to receive illiquid shares of his new company, or to sell their stakes on Craigslist. All of which is to say, he’s grown a lot in the last year.  BlueLine fund investors, who were told in Harbinger’s most recent letter that their redemptions have been suspended, should keep that in mind. Read more »

Paulson And Co Investors Standing By Their Man

John Paulson, the billionaire hedge- fund manager having the worst year of his career, has received less than 10 percent in redemption requests for his Recovery and Credit Opportunities funds for year’s end, according to two people familiar with the firm. Withdrawal orders for those two funds, which together managed about $15 billion as of July 31, were due at the end of September and may give some indication of what total redemptions could be across all of Paulson’s funds, the worst-performing of which has tumbled 47 percent this year…“We’re going to give Paulson the benefit of the doubt,” said Trip Kuehne, founder of Double Eagle Capital Management LP, a Dallas-based firm that has invested with Paulson since 2005. “I believe in him and his firm and don’t plan to pull my money.” [Bloomberg]

Highland Capital Investors Will Get Their Money…In 2014

Which is a mere 6 years after they asked for it back, so, not much to complain about here. Read more »