Paulson & Company’s John Paulson has donated $400 million to Harvard, the largest gift ever given to the institution. The gift is intended to support the School of Engineering and Applied Sciences, which will be renamed the Harvard John A. Paulson School of Engineering and Applied Sciences. The school plans to use the money for faculty development, research, scholarships and financial aid. Paulson graduated from Harvard Business School with high distinction in 1980. He founded the firm in 1994 and today manages more than $19 billion. “John Paulson’s extraordinary gift will enable the growth and ensure the strength of engineering and applied sciences at Harvard for the benefit of generations to come,” said Drew Faust, the president of Harvard University, in a press release.
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Ackman also made the front page of the New York Times Wednesday. The paper reported that Herbalife, which Ackman’s Pershing Square Holdings has been shorting, has moved from defense to offense. After defending itself for the past two years or so from Ackman’s attacks — he argues the company is a pyramid scheme — Herbalife has apparently been talking to the authorities, including the FBI, the Justice Department and the Securities and Exchange Commission, arguing that the activist hedge funder is manipulating the market with false statements. Herbalife, says the Times, has hired Democratic operatives, three public relations firms (including Sard Verbinnen, for opposition research), two law firms (Gibson Dunn and Sidley Austin), plus a raft of lobbyists and compliance experts to help in the campaign. Ackman himself traveled to Washington to urge regulators and Congress to look into charges against Herbalife at one point, and hired several law firms, lobbyists and a public affairs company, Global Strategy Group, to help in his campaign. The Times notes that for all the firepower, the authorities remain cautious about intervening, and that “the hurdles to mounting a case against either side were steep.” Without the government stepping in, the paper adds, a resolution is unlikely. One thing is likely, however: Without the feds stepping in, Herbalife can probably outlast a short.
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William Ackman’s Pershing Square Capital Management disclosed it owns 21.7 percent of Nomad Holdings, a special-purpose acquisition company (SPAC) formed in April 2014 by Martin Franklin and Noam Gottesman. Earlier this week, Nomad completed its acquisition of Iglo Foods Holdings, a European frozen-food company best known for its Birds Eye brand, for 2.6 billion euros ($2.93 billion). On Wednesday, Nomad also confirmed that it is in exclusive early-stage discussions with British frozen-food company Findus to acquire its continental Europe business and the Findus brand. Gottesman is no stranger to SPACs. He was one of the founders of London hedge fund firm GLG Partners, which was acquired by Man Group. In 2007, GLG was one of the first alternative investment firms to go public, executing it through a reverse acquisition by Freedom Acquisition Holdings, a special-purpose acquisition company trading on the New York Stock Exchange. Freedom was co-founded by Franklin, at the time chairman and CEO of Rye, New York–based consumer products company Jarden Corp., and Nicolas Berggruen, founder and president of New York–based family office Berggruen Holdings. Meanwhile, Pershing Square Holdings reported it rose 0.5 percent in May, bringing its gains for the year-to-date to 6.8 percent. The firm currently has $19.8 billion under management invested in 11 longs and one short. ___
Shares of Wendy’s surged around 4 percent Wednesday after the fast-food chain said it would repurchase up to $639 million in shares. One of the biggest beneficiaries is Nelson Peltz’s Trian Fund Management, the largest shareholder. The New York activist said in a regulatory filing it will sell some of its shares, but after the buyback so it does not reduce the stock’s liquidity. Instead, in a separate transaction, Trian said it will sell at least 20 percent of its holdings back to the company after the buyback is completed. Under a formula, Trian plans to reduce its stake to between 17 percent and 19.68 percent of the shares outstanding. It stresses that after the sale it will remain the largest shareholder. Remember, Peltz serves as the chairman of the board, Trian co-founder Peter May is vice chairman and Trian co-founder Edward Garden serves as a director. ___
Now this is what you call hedge fund fandom. London-based Preqin reports 227 investors worldwide have at least $1 billion invested in hedge funds. In the past year the number in the so-called billion-dollar club rose by a net 24 after 51 investors boosted their allocations to more than $1 billion while 27 investors reduced their holdings below that level. Altogether, 227 investors have $735 billion in hedge funds, up 13 percent from May 2014. According to the report, private sector pension funds accounted for 29 percent of new members while 77 percent of newcomers are based in North America. Their preferred strategies? Nearly half — 48 percent — have targeted macro funds for the next 12 months,followed by 39 percent in long/short equity.
