This content is from: Portfolio

The Morning Brief: Hedge Funds Find a Friend in Ally

When William Ackman launched his campaign to expose Herbalife as a pyramid scheme, shorting the stock and publicly denouncing the multilevel marketer of nutrition supplements, he called for the Federal Trade Commission to launch an investigation into the Los Angeles-based company. Now, the Pershing Square Capital Management founder finds himself on the receiving end of regulatory scrutiny. The Securities and Exchange Commission is now looking into whether Ackman and partner Valeant Pharmaceuticals’ takeover attempt of Botox-producer Allergan has violated securities laws, the Wall Street Journal reports. The now-$53 billion dollar offer has been repeatedly rejected by Allergan, and though it is it the SEC’s sights, no enforcement is necessarily forthcoming. Both Pershing Square and Valeant have maintained the joint venture is on the level.

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It’s been 45 days since June 30, which means 13F filings are finally due. The mandatory quarterly filings require hedge fund managers to list their firm’s holdings, though the 45-day window between the end of the quarter and the filing due date means the information isn’t necessarily an accurate reflection of what managers presently hold in their portfolios. One stock that turned up in several funds’ portfolios was Ally Financial, the former financial unit of General Motors that necessitated a government bailout during the crisis. The Wall Street Journal reports the government is close to washing its hands of the company and will soon sell off more shares.

Among holders in Ally include Daniel Loeb’s Third Point, which pulled in more than 45 million shares of the auto lender, making it the firm’s second-largest holding. Richard Perry’s Perry Capital added some 14 million shares; Jeffrey Aronson’s Centerbridge Partners picked up 8.3 million; Howard Marks’ Oaktree Capital Management bought 8 million shares; Hopkins, Minnesota-based CarVal Investors tacked on 4.2 million shares; and Bruce Richards’s Marathon Asset Management grabbed almost 3.1 million shares of Ally stock.

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Two Tiger Cubs made waves on the Apple front. Coatue Management, Philippe Laffont’s New York–based hedge fund firm, upped its stake by more than 8.5 million shares, bringing its total position to more than 10 million shares, or some 11.7 percent of Coatue’s portfolio. Robert Citrone’s Discovery Capital Management entered the position with 6.5 million shares, with the iPhone maker now comprising 5.8 percent of Discovery’s portfolio. Apple is both firms’ largest position.

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Loeb’s Third Point has a new top holding in Dow Chemical. The firm bought more than 14 million shares to bring its total up to 22 million. The position, as well as Third Point’s Ally holdings, leapfrog Actavis for the top two spots. Dow is now just less that 14 percent of Loeb’s portfolio.

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