Is the new Tiger Global Management becoming an activist? The New York hedge fund manager, which recently announced management changes, filed a rare 13D disclosing it owns about 9.4 million shares, or 21.5 percent, of eHi Car Services, the giant Chinese car-services provider. In the late Monday filing, Tiger Global said it purchased the shares for “investment purposes,” but stated in boiler-plate language it may take some sort of future actions with the company. This is unusual for the hedge fund firm, which in the past regularly used passive 13G forms when disclosing large stakes in companies, especially in emerging markets. Last month, Tiger Global announced that Feroz Dewan, who heads up the public hedge funds and long-only funds, is leaving at the end of June to start his own firm. He will be replaced by Scott Shleifer, who has been with the firm since 2002.
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Richard “Mick” McGuire III’s Marcato Capital Management has headed back to court in an attempt to force Sotheby’s to disclose certain information the auction house has asserted is confidential. In a new regulatory filing, the San Francisco activist hedge fund says it has gone to Delaware Chancery Court seeking certain documents from earlier legal proceedings currently under seal involving Sotheby’s and Daniel Loeb’s Third Point. Marcato notes that while the resolution of that dispute was announced on May 5, “completely unredacted versions of certain court filings remain unavailable to the public.” Marcato argues the information in the documents under seal “does not appear to be the type of proprietary information that would warrant protection from release by the court,” adding “in any event, sufficient time has passed since the action concluded to warrant unsealing.” Marcato also points to an order dated May 7 whereby the Delaware court granted the hedge fund’s previously disclosed request to unseal Third Point’s opening brief in support of its motion for preliminary injunction, filed April 29, 2014. The firm notes the brief was subsequently released to the court file in unredacted form. We earlier reported that in March Marcato filed legal action to force Sotheby’s to disclose certain documents from earlier legal proceedings.
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New York-based Third Point Offshore Fund rose 1.9 percent in May, bringing its gain for the year to 5.7 percent. According to the firm’s May tear sheet, most of the gains came from the long-short portfolio while a small portion was generated by the credit portfolio. Meanwhile, two stocks Third Point singled out as new positions in its first quarter letter to clients have performed very well so far in the second quarter. Yum Brands was up 4.8 percent May and 15 percent over the past two months. Devon Energy was down 4.4 percent in May but is still up 8 percent since the beginning of April. Entering June, the long-short portfolio is 61.1 percent net long, a slight uptick from the prior month.
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Davidson Kempner Partners disclosed it owns 1.4 million shares of GP Investments Acquisition, or 7.25 percent of the total outstanding shares. Last week, the shell company raised $172.5 million to do some sort of deal, including a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or some other business combination. Its sponsor, GPIC, is a wholly owned subsidiary of GP Investments, a private equity firm.
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The Lyxor Hedge Fund index rose 0.4 percent in May, boosting its gains for the year to 4 percent. It notes in a report that all strategies, except CTAs, posted gains in the month.
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Mark Kingdon’s funds are off to a strong start this year. The New York manager’s Kingdon Global Long/Short Equity (Composite) rose 4.69 percent in May and is now up 12.19 percent year-to-date. Kingdon Credit rose 1.38 percent in May and is now up 6.22 percent for the year. Kingdon had $2.1 billion in its long-short strategy as of April 1.
