The Morning Brief: Another SAC Arrest — But Not for Insider Trading
Another manager working for Steven Cohen has resigned following a brush with the law — but this time it has nothing to do with insider trading or anything else related to the capital markets. Rather, Paul Orwicz, who had been with the billionaire’s SAC Capital Advisors since 1998, left Cohen’s family office Point72 Asset Management a week after being arrested for reckless driving, improper passing and disobeying a police officer signal while driving his McLaren racing car. Orwicz told Bloomberg the timing of his resignation was coincidental since last week his most recent two-year contract ended. He told the wire service he is pursuing some undefined other opportunities.
“We do not comment on internal personnel matters,” Jonathan Gasthalter, a spokesman for Point72, told Bloomberg. “The management of Point72 expects our employees, at every level of the organization, to act with professionalism and integrity at all times.” Orwicz said the charges of disobeying an officer were a misunderstanding, explaining that when an officer was slow to get out of his unmarked car that pulled him over, he feared he was being carjacked.
Pershing Square Capital Management’s William Ackman fired off another letter to the board of directors of Allergan, calling on the pharmaceutical company to once again “rescue their reputations by taking over leadership of this process” from chairman and chief executive officer David Pyott and his advisors and do “what they are paid $400,000 per year to do” and approve the takeover offer from Valeant Pharmaceuticals. Ackman notes that in the past week, he delivered consents from one-third of Allergan’s shareholders to call a special meeting, stressing that this one-third “vastly understates shareholder sentiment on this issue.”
Ackman tells the directors: “I have been hoping that to date that you had simply been uninformed and misled, and that the calling of a special meeting by many of your largest, most important and long-standing shareholders coupled with the harsh rebuke you have received from both ISS and Glass Lewis would jolt you out of your stupor.”
BH Credit Catalysts Ltd. fell 1.10 percent in August, trimming its gains for the year to 6.44 percent. This was the fund’s first monthly loss since June 2013. It is managed by DW Investment Management, a New York-based unit of Brevan Howard Asset Management. Separately, in its recently released July monthly report, the fund addresses the widening of spreads in the junk bond market in July, asserting that concerns over possible market liquidity are unfounded despite a nearly 4 percent outflow from high yield mutual funds and ETFs.
“In past periods of similarly large outflows, prices have generally fallen more than was the case in July (approximately 3 percent on average compared to the approximately 1 percent drop in July), indicating demand from institutional channels for high yield assets,” the fund’s letter states. “Volumes also held up over the month, with institutional high-yield trade volume tracking approximately on par with volume traded year to date.”
Leon Cooperman, who heads New York-based Omega Advisors, disclosed that he owns 9.9 percent of Aspen Group, as a passive investment. Interestingly, the provider of online distance-learning education services is now a penny stock, trading at just $0.256 per share.
D.E. Shaw & Co. disclosed that it owns 5 percent of Delek US Holdings, an energy company. In a 13G filing, the New York hedge fund firm stresses that it is a passive investment.