Valeant Pharmaceuticals International named three new members to its board of directors, including one with ties to Valeant stock holder William Ackman’s Pershing Square Capital Management. Stephen Fraidin, a vice chairman with the activist hedge fund firm, joins Valeant’s board along with Dr. Fred Eshelman, a 35-year pharmaceutical industry veteran and founder and former chief executive officer and executive chairman of Pharmaceutical Product Development, and Thomas Ross, former president of the University of North Carolina. The stock surged nearly 6 percent on the news, but it is still barely off its lows.
Canyon Capital Advisors has turned up the heat on Ambac Financial Group. The Los Angeles hedge fund firm fired off a long letter detailing a number of major concerns with Ambac management and the governance of the board of directors ahead of the bond insurer’s annual meeting on May 12. Canyon criticized the board’s decision to name Nader Tavakoli as permanent president and CEO despite what it deems “his lack of relevant experience and demonstrably substandard performance,” calling the appointment “alarming.” Canyon also criticized Tavakoli’s compensation package and management and the board’s “failure to develop and implement” a strategy. The hedge fund firm also lambasted Ambac’s board for refusing to meet with the investor.
Canyon manages more than $20 billion. Shares of Ambac climbed a little less than 1 percent on Wednesday. Last week, Reuters reported that Canyon plans to submit three nominees to the Ambac board. It also said the firm wants Ambac to speed up its settlement of $4 billion in insurance claims.
Aspect Capital says it acquired rival Auriel Capital Management and hired its team in a merger of computer-driven hedge funds. In a press release, the London firm said it has been looking to diversify its strategy capabilities. According to published reports, Aspect thinks Auriel gives it an opportunity to expand into currency trading. Computer-driven hedge funds, also called systematic traders, have been the top performers this year in what is otherwise an abysmal start for most hedge fund strategies. Aspect’s flagship product, the Aspect Diversified program, is up 5.17 percent through the first two months after gaining 8 percent last year and 32 percent in 2014.
UBS cut its rating on Yelp to sell from neutral and maintained its $17 target price, telling clients it is “skeptical of a turnaround” at the online restaurant and retail reviews company. UBS says in a note that the companies that will prevail in the battle for local advertising budgets have established mobile user bases, can benefit from operating scale advantages and have shown product innovation. “In our view, Yelp will enter a period of slowing revenue growth and heightened margin pressures, driven by increased competition in Yelp’s core business and share gains by larger digital ad companies,” the bank adds in the note. Yelp shares dropped 3 percent on Wednesday. At the end of 2015, five of Yelp’s top-ten shareholders were hedge fund firms, led by Hong Kong–based Tybourne Capital Management, the largest shareholder. Other top shareholders include New York-based Maverick Capital, New York-based Eminence Capital and Chicago-based Citadel.
Leon Cooperman’s Omega Advisors cut its stake in Atlas Energy to about 2.6 million shares, or 9.99 percent of the total outstanding.