The Morning Brief: Blackstone Reportedly Redeeming from SAC
Steven Cohenâ€™s SAC Capital Advisors has seemingly taken another big step toward becoming a family office. Blackstone Group Inc., SACâ€™s largest outside investor, has reportedly told Cohen it plans to “fully redeem” a significant slice of its $550 million or so investment in the embattled $15 billion hedge fund giant. This would be a huge blow to Cohen, who has already watched $1.7 billion in outside money leave the firm this year. In fact, another report speculates that Cohen is devising plans to shut the firm and become a family office. Although this report suggests this is a new development, it would be stunning if Cohen had not been mulling this kind of contingency plan, as the government has been turning up the heat on the hedge fund trader. Cohen ranked third on this yearâ€™s Rich List, the annual Institutional Investorâ€™s Alpha ranking of top-earning hedge fund managers, after earning $1.4 billion in 2012 alone.
Bad news for Eddie Lampertâ€™s ESL Partners. Shares of Sears Holdings slumped 13.6 percent on Friday after the long-struggling retailer reported a first quarter loss and lower revenues after the marketâ€™s close on Thursday evening. Lampert called the results â€œnot acceptable.â€ The stock is still up more than 25 percent so far this year. Last year Lampert earned $750 million, landing sixth on the Rich List.
Tessera Technologies is the latest company to agree to a settlement with activist hedge fund Starboard Value. Just before the May 23 annual meeting, the maker of imaging systems for smart phones agreed to appoint six of Starboardâ€™s nominees to its board of directors. It then expanded the board from eight to 12 members. To allow additional time for shareholders to vote on the revised slate of director nominees, Tessera also announced that the annual meeting would convene solely to adjourn to June 7.