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The Morning Brief: Valeant Shares Turn Negative for the Year
So much for the Valeant Pharmaceuticals International rally. Shares of the embattled drug company plunged 5 percent on Monday, to close at $13.99. This wiped out their strong early-year gains and put the stock down 3.65 percent for the year. Remember, the stock plummeted by 86 percent last year. Monday’s sharp downturn came despite the lack of any major news on the company or stock. At the end of the third quarter the three largest shareholders were Pershing Square Capital Management, Paulson & Co. and ValueAct Capital Management. PointState Capital was the fifth-largest shareholder.
The Ohio Public Employee Retirement System (PERS) voted to retain its investments in hedge funds even though two board members opposed the decision, according to the Toledo Blade. The board also voted to maintain the pension fund’s hedge fund exposure at 8 percent of its total assets while keeping hedge fund exposure in the system’s separate health-care fund at 6 percent. Altogether, the system has $6.5 billion invested in hedge funds between the two funds. The paper points out that hedge funds returned more than 4 percent per year over the past five years, citing Rick Shafer, PERS’ chief investment officer. The overall investment target, however, is about 7 percent.
Elliott Associates, the hedge fund managed by Paul Singer’s Elliott Management Corp., disclosed it owned more than 4.3 million shares, or 6.9 percent, of Northern Oil and Gas as of January 10. The sometime-activist manager made the filing in a 13G, meaning the investment in the independent energy company is passive, at least for now.
At least three hedge funds disclosed in separate regulatory filings that they acquired sizable stakes in Gores Holdings II, a blank check company created to do a deal such as a merger, acquisition or reorganization. It raised $375 million in an initial public offering last week. Highbridge Capital Management said it bought a 6.13 percent stake, BlueMountain Capital Management took a 6 percent stake, and Davidson Kempner — a big fan of these blank check companies — acquired a 6.25 percent position.