Ritchie Capital in deal with Reservior Cap-sources Bear Stearns Paid Chief Cayne $40 Million Last Year Goldman CEO targets $19-$20 bln LBO fund Money-Manager Raid Sparks Court Fight ABN Amro considers break-up vote India: PE funds likely to be regulated More headlines below
UK to ease hedge fund rules Lender Said to Be Weighing a Bankruptcy Filing Soon SEC probes mortgage lenders for fraud Lennar warns of slow start to spring sales GM pulls out of the race for Daimler’s troubled Chrysler unit GM-Chrysler Merger Likely to Face Antitrust Obstacles UAW chief vows strike if Delphi tries to void pact Apollo Suit Suggests LBO Shift DoubleClick Explores a Sale The Hard Sell- Gap Struggling to Fill CMO Void; New Ads Ineffective Tribune Debt May Sink Zell: Analysts
Ritchie Capital in deal with Reservior Cap-sources – Reuters
Ritchie Capital Management LLC, a once high-flying hedge fund manager that fell on hard times, has reached a deal with Reservoir Capital Group for a cash injection, according to people familiar with the plan.
The plan, which Ritchie investors must approve by Friday, will give investors who want to opt out of Ritchie’s flagship multi-strategy fund with about 50 cents on the dollar, with half of that paid after the close of the deal and the remainder over three years, sources said.
A spokesman for Ritchie declined to comment. Reservoir officials could not be reached….
Bear Stearns Paid Chief Cayne $40 Million Last Year – Bloomberg
Bear Stearns Cos. paid Chief Executive Officer James Cayne $40 million last year, a 32 percent raise, after the firm reported its fifth straight year of record profit.
Cayne, 73, received a $250,000 salary, a $17.1 million cash bonus, $14.8 million in stock, $1.69 million worth of options to buy stock and $6.15 million in other compensation, the New York- based securities firm said in a filing with the U.S. Securities and Exchange Commission today. The stock and options awards were initially revealed in December. Cayne made $30.3 million in 2005.
Goldman Sachs Group Inc., the largest U.S. securities firm, set a new all-time high for Wall Street compensation last year, granting CEO Lloyd Blankfein $54 million. Morgan Stanley CEO John Mack was paid $41.4 million while Lehman Brothers Holdings Inc. paid CEO Richard Fuld $40.5 million. Fiscal 2006 profit at Bear Stearns, the fifth-biggest U.S. brokerage, surged 40 percent to an all-time high of $2.1 billion, half that of Lehman, one third of Morgan Stanley and one fifth of Goldman….
Goldman CEO targets $19-$20 bln LBO fund – Reuters
Goldman Sachs Group Inc. Chief Executive Lloyd Blankfein said on Tuesday the investment bank expects to raise around $19 billion to $20 billion for its next private equity fund.
"It might be a little more, it might be a little less," Blankfein told shareholders at the company’s annual meeting in New York City.
That amount would make the fund much larger than those being raised by its prized private equity clients, increasing the chances that Goldman will compete with them on deals.
Reports of the projected size of Goldman’s fund surfaced last month…..
Money-Manager Raid Sparks Court Fight – Wall Street Journal
NEW YORK — In a brazen move on a rival, the Wall Street arm of Deutsche Bank AG hired away 16 money managers from Amvescap PLC — a group that ran 20% of Amvescap’s massive $465 billion in assets.
That move is triggering a legal counterattack that is fierce even by Street standards.
According to executives at both companies as well as documents describing the meeting, the fight started Friday, when a top-level Deutsche executive, Kevin Parker, took the uncommon step of visiting Amvescap’s chief executive to tell him he was hiring away a key group of employees and to propose a deal that would avoid a court fight between the two companies….
ABN Amro considers break-up vote – Financial Times
ABN Amro, the Dutch bank courted by Barclays of the UK, is expected to meet all the demands of activist investors by including a break-up vote on the agenda, published Wednesday, of its April annual meeting.
The decision reflects the fact that ABN does not want to risk provoking investors during the Barclays talks, which are aimed at creating the world’s fifth largest bank with a market value of more than $175bn.
It also underscores a view within ABN that many shareholders believe the takeover negotiations have superseded the demands levelled a month ago by minority investor The Children’s Investment Fund (TCI)…..
India: PE funds likely to be regulated – Business Standard
Private equity (PE) funds may come under the regulatory scanner in India.
Though the ultimate regulator has not been decided upon, both Securities and Exchange Board of India (SEBI) and Reserve Bank of India have formed study groups to analyse the structure and impact of such funds on the investors, the companies in which they invest in and their effect on corporate governance.
The issue has gained importance as a working group of International Organisation of Securities Commission (IOSCO) has been set up to study the impact of private equity funds on emerging markets.
Incidentally, the Indian market regulator is the chairman of IOSCO’s emerging market committee. The Indian regulators will also have consultative discussions with other regulators during the 32nd annual conference of IOSCO to be hosted by SEBI in India this year…..
UK to ease hedge fund rules – Financial Times
British small investors will be able to put money into the fast-growing hedge fund sector without having to go offshore under rules proposed on Tuesday by the UK’s Financial Services Authority.
Unit trusts and other open-ended funds investing in hedge funds should be allowed to set up in the UK as long as they carried out a proper examination of the risks of the funds in which they put money, the regulator said.
However, industry representatives warned that the development of onshore funds of hedge funds would depend on the Treasury changing the tax regime….
Lender Said to Be Weighing a Bankruptcy Filing Soon – New York Times
New Century Financial, the troubled subprime mortgage company, could file for bankruptcy protection as early as the end of this week, people briefed on the company’s plans said yesterday.
The company, which stopped making loans this month after federal prosecutors and regulators began investigating it, is trying to tie up financing that would allow it to reorganize or sell itself through a prepackaged bankruptcy, rather than be forced to liquidate itself.
New Century is still hoping to find a buyer for the company, but the chances for such a deal appear to be dimming…..
SEC probes mortgage lenders for fraud – Financial Times
US authorities stepped up investigations on Tuesday into possible fraud by companies in the high-risk mortgage market.
The Securities and Exchange Commission told Congress it had set up an enforcement unit to probe possible fraud involving subprime mortgage lenders.
The move comes as lawmakers increase political pressure on regulators to act over a growing crisis in the mortgage market. Lawmakers fear more than 2m Americans could be vulnerable to foreclosure on their homes in the next two years following a loosening of lending standards and allegations of mis-selling by mortgage companies…..
Lennar, the third-largest US homebuilder, provided more evidence of the sagging confidence in the housing sector on Tuesday as it warned that the traditional spring selling season had failed to ignite.
The Miami-based group also abandoned its earnings guidance for the year and took additional charges against falling land values as recent economic data suggested the recovery of the national market will take longer than many experts had predicted.
While many homebuilders have cut construction and increased discounts to shift unsold inventory, there are rising concerns the problems in the subprime lending sector will spread to more traditional mortgages and delay a broad-based recovery until early next year….
GM pulls out of the race for Daimler’s troubled Chrysler unit - The Times of London
General Motors will not put in a first-round bid for Chrysler, leaving only private equity and an automotive parts group in the frame for the US carmaker, The Times has learnt.
Proposals are due to be submitted to JPMorgan Chase, which is advising DaimlerChrysler, Chrysler’s owner, on Friday. However, sources close to the talks said that GM would not make a bid because it believes that it does not need any additional capacity.
GM is in the middle of a massive restructuring in an attempt to restore it to profitability and has cut production in the US. The world’s biggest carmaker recently reported a profit for the final quarter of last year — its first move into the black for two years….
GM-Chrysler Merger Likely to Face Antitrust Obstacles – Bloomberg
General Motors Corp. probably would have to sell at least part of the light truck division of DaimlerChrysler AG’s Chrysler unit to clear U.S. antitrust review in any potential takeover, two analysts said.
“A GM-Chrysler merger would require GM to divest most, if not all, of Chrysler’s truck assets,” Bear Stearns & Co.’s Peter Nesvold in New York said today in a research note. “This is highly unattractive, based on the disproportionate amount of profit that the truck assets contribute.”
DaimlerChrysler is weighing the future of money-losing Chrysler after saying on Feb. 14 “all options” were under consideration. GM, the world’s largest automaker, is discussing joint vehicle development with Chrysler and an outright purchase, people with knowledge of the talks have said….
UAW chief vows strike if Delphi tries to void pact - AP Via Columbus Dispatch
United Auto Workers President Ron Gettelfinger said yesterday that he’s tired of playing around with struggling auto-parts maker Delphi Corp. and vowed to strike if the company continues with plans to void its labor contracts in court.
Speaking at the close of the first day of the union’s bargaining convention in Detroit, a strident Gettelfinger said there are no talks under way with Delphi at present, and he accused the company of "playing games" with the union.
"If they void the contracts, we are going to shut them down," he said.
Gettelfinger said he could not remember the last time he talked with Delphi and didn’t know when his vice president in charge of negotiating with the company last bargained with its executives…..
Apollo Suit Suggests LBO Shift – Wall Street Journal
In a rare move for a private-equity firm, Apollo Management LP sued EGL Inc. to block a sale of the Houston logistics concern to a group led by the company’s chief executive. Apollo also raised its buyout offer by $1 a share to $41.
The suit, filed in Harris County, Texas, also names EGL Chief Executive Officer James Crane and the company’s directors. The complaint seeks access to information about the company and a level auction playing field that Apollo contends it has been denied….
DoubleClick Explores a Sale – Wall Street Journal
Online advertising firm DoubleClick Inc. is exploring a sale, and is already in active talks with Microsoft Corp., among other potential suitors, according to people familiar with the matter.
The New York-based company is using investment bank Morgan Stanley to help sound out its options, these people said, including a possible stock-market listing. The company is majority-owned by San Francisco private-equity firm Hellman & Friedman, which since purchasing DoubleClick in 2005 for approximately $1.1 billion, has sold off a number of divisions and reshaped the business. Hellman is seeking at least $2 billion for DoubleClick, said one person briefed on the situation, and it remains an open question whether the firm will choose to complete a deal.
DoubleClick offers services for online advertisers, ad agencies and Web publishers for managing, delivering and measuring online advertising. The company had roughly $150 million in revenue last year, according to a person familiar with the matter. More than $100 million came from serving ads for publishers to their Web pages and delivering the ads to be served on behalf of advertisers, this person says. A DoubleClick spokeswoman declined to comment on "rumors and speculation."….
The Hard Sell- Gap Struggling to Fill CMO Void; New Ads Ineffective – New York Post
Gap, struggling to lure shoppers to its stores, faces an even harder sell when it comes to finding a new marketing chief.
After slumping sales, fashion missteps and an exodus of executives that included Kyle Andrew, the vice president of marketing for the Gap brand, the retailer has embarked on a search for creative talent to help with a turnaround.
The retailer’s search firm has approached several candidates to replace Andrew – who jumped to Kenneth Cole in January – only to be rebuffed, said a source familiar with the search….
Tribune Debt May Sink Zell: Analysts – New York Post
Winning the auction for Tribune Co. may prove to be only half the battle for Sam Zell.
The Chicago real estate billionaire’s late-inning bid is now considered the frontrunner in Tribune management’s self-imposed Saturday deadline to announce the fate of the newspaper and TV-station empire after a lackluster six-month auction.
If he’s successful in trumping a bid by fellow billionaires Ron Burkle and Eli Broad and a management proposed restructuring, Zell will become the owner of a deteriorating debt-laden business that’s burdened by regulatory challenges, Wall Street analysts say….
