Hedge fund headlines in brief
Line blurs between long-only managers and activists. The battle for the hearts and proxy votes of pension funds that was the subject of our last posting is now examined by The New York Times and this account suggests activists are gaining the upper hand and that certain pension funds and activists are “constantly discussing a variety of companies.” Performance of the activist segment is one driver for the increase in engagement, but the story says “activists may have also done themselves a favor by cleaning up their image.” As we wrote in our previous post, the open question is which activists will create the brand and reputation that will become the trusted partner for pension funds. The reward for getting this right is enormous. The Times cites ValueAct and its thesis on Microsoft and explains “though ValueAct had bought less than 1 percent of Microsoft’s stock, the company granted the fund a board seat, recognizing that the hedge fund was speaking for other investors, too.”
Hedge funds turn up the volume with new media. Balyasny Asset Management generated buzz with its print ad campaign, the likes of which are permissible under the JOBS Act. The JOBS Act which eases the ban on general solicitation has emboldened hedge funds to also post commentary videos to their Web sites and to have managers appear more frequently on TV. Take that lawyers! In other new media news, Greenlight Capital is suing to find the identity of an anonymous blogger who supposedly disclosed a position taken by the fund, Carl Icahn expands his electronic media presence to Facebook, and Glaucus Research adapts a popular Hitler video on YouTube to jab Ocwen Financial, which the fund accuses of financial impropriety.
The long haul for the Herbalife short. Almost a year into it, Pershing Square is keeping the pressure on Herbalife. The newest lever pulled by the fund? Lawmakers. A detailed account of the multifaceted campaign organized by Pershing Square examines lobbying, grassroots organizing, letter writing and a focus on Latinos that are the newest tactics employed by the fund and its consultants.