Goldman Sachs Group’s Petershill II fund has bought a 10 percent stake in the global macro hedge fund firm Caxton Associates, according to Reuters, citing two sources familiar with the deal. It is the fund’s third investment. Reuters did not disclose terms of the deal, but said the stake could eventually be lifted to 20 percent. New York-based Caxton was founded by Bruce Kovner in 1983. It is now headed by Andrew Law, who took over for Kovner when he retired three year ago. Today it manages $8 billion. Petershill II, launched earlier this year, specializes in taking minority positions in established hedge funds.
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In other hedge fund transactions, New York-based Neuberger Berman is acquiring Ramius’s interest in Orchard Square Partners, a global long-short credit investment specialist with $475 million in assets. Orchard Square is led by Norman Milner, Rick Dowdle, Darren Carter and Itai Baron. Ramius is the alternative investment management business of New York-based financial services firm Cowen Group, Inc.
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Jeffrey Smith’s Starboard Value, which is locked in a bitter proxy fight with Darden Restaurants and also agitating for change at Yahoo, has turned its sights on RealD, a maker of projection technology for 3-D films. The New York-based activist hedge fund firm has offered to acquire the Beverly Hills, California-based company for $12 a share in cash. This represents a 29 percent premium over the stock’s closing price on October 1.
In a letter to chairman and chief executive officer Michael Lewis, Peter Feld, managing member at Starboard, says RealD would be better off as a private company, saying, “The time frames and capital requirements needed to support many of the company’s growth initiatives appear to be well beyond what the public markets will bear.” Feld says Starboard’s “deep knowledge” of the technology markets would make it an ideal partner with management. “As a private company we can also recapitalize the company in a conservative manner that allows for significant improvements in return on equity and invested capital,” he adds.
In early May, Starboard disclosed that it owned 6.3 percent of RealD, but at the time the firm stressed that this was not an activist stake, saying in a regulatory filing at the time that it thought the stock was “undervalued and represented an attractive investment opportunity.” Starboard said back then it had no plan or proposal for unlocking this value but may take some sort of action in the future. And here it is.
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Daniel Och’s OZ Master Fund, managed by his New York-based hedge fund firm Och-Ziff Capital Management, posted a slight loss of 0.07 percent in September and is now up 2.53 percent for the year-to-date. The firm’s OZ Europe Master Fund gained 0.56 percent, trimming its loss for the year to 0.73 percent, while its OZ Asia Master Fund gained nearly 1 percent, cutting its loss for the year to 3.43 percent. Och-Ziff, one of the only hedge fund firms that is public, also said assets under management grew by $100 million, to $46.2 billion, from the prior month. The asset figure includes September performance and capital flows from September 2 through October 1.
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Purchase, New York-based Greywolf Capital Management disclosed that it owns 5.2 percent of Horsehead Holding Corp., a major zinc producer.
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Boaz Weinstein’s New York-based hedge fund firm Saba Capital Management disclosed large passive investments in two closed-end mutual funds. Saba said it owns 5.334 percent of Blackstone / GSO Long-Short Credit Income Fund and 5.076 of the Wells Fargo Advantage Income Opportunities Fund.
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The Credit Suisse Liquid Alternative Beta Index declined by 0.92 percent in September, trimming its gain for the year to 1.83 percent. The Credit Suisse Long/Short Liquid Index fell 0.93 percent last month and is now up 4.64 percent for the year. The LAB indices try to replicate the return profiles of hedge fund strategies using liquid, tradable instruments.
