Skip to main content

Jeff Ubben has had his differences with Henry Kravis over the years, and it’s probably safe to say that now, they have several others.

“Finance is, like, done. Everybody’s bought everybody else with low-cost debt. Everybody’s maximised their margin. They’ve bought all their shares back . . . There’s nothing there. Every industry has about three players. Elizabeth Warren is right.”

Finance isn’t the only thing that’s done. Ubben is, too, with the activist hedge fund he founded almost two decades ago. That is to say, he’s almost done with it—he’ll keep helping out until his new hedge fund (we guess he’s also only almost done with finance, as well)—Inclusive Capital Partners, taking his nice guys finish first philosophy to new, socially-impactful levels—is more of a full-time job.

He will continue managing ValueAct’s own $1bn impact fund while his new business gets off the ground. Existing investors in that fund will have the option to transfer their money over to the new venture…./Having an impact fund and a traditional fund under the same roof at ValueAct was “confusing” for investors, Mr Ubben said. Those who opted for the impact vehicle worried they were leaving returns on the table, and those who opted for the flagship fund worried that about being portrayed as environmentally or socially “unconscious”, he said.

“I don’t think these two strategies peacefully coexist,” said Mr Ubben.

We wonder why….

U.S. companies have about a 3% chance on average of being targeted by an activist hedge fund, but the probability nearly doubles for those who are top spenders on corporate and social responsibility (CSR) programs, according to the study, which analyzed 506 instances of shareholder activism between 2000 and 2016.

“CSR spending can be an indicator (to hedge funds) that there might be some wasteful spending at companies and that maybe top management isn’t focused on the short-term returns,” one of the study’s authors, Pennsylvania State University professor Mark DesJardine, said in an interview.

Anyway, we’re sure Ubben really and truly wishes his soon-to-be-former colleagues at ValueAct all the best going forward.

Activists can still “bully little companies to sell to private equity,” he said, but doing so will only provide modest profits.

Jeff Ubben quits ValueAct for social investing [FT]
Companies that spend on social causes risk hedge fund challenge: study [Reuters]


(Getty Images)

ValueAct Loves Itself Some James Gorman

The Morgan Stanley CEO is safe in this activist hedge fund's arms.


Paul Tudor Jones Has Been Reading Marx Again

The hedge-fund billionaire thinks capitalism needs some tweaking, and he’s got just the thing.

Not happy! (Louis Bacon/Getty Images)

Louis Bacon Is Having The Time Of His Life

His hedge fund soars as his rival is destroyed. Coincidence? We think not.

Howard Marks Is Not Impressed With Hedge Fund Peers

Basically no one in the industry deserves the fees they're charging, with the exception of Marks' own fund, naturally.