David Tepper, who has topped Alpha’s Rich List three times in the past five years, may be headed for divorce court. Tepper, perhaps the greatest non-quant hedge fund manager of all-time, who made $3.5 billion last year alone, has separated from his wife Marlene after 28 years of marriage, according to a report in the New York Post. Tepper, whose Short Hills, New Jersey–based firm Appaloosa Management runs about $20 billion, earned $2.2 billion in 2012. He also is a minority owner of his hometown Pittsburgh Steelers professional football team. Several years ago he shelled out $43.5 million for a Hamptons estate, buying it from Joanne Corzine, the ex-wife of Jon Corzine, his ex-boss he has partly held responsible for not making him partner at Goldman Sachs.
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Allergan officially rejected the latest takeover offer from Valeant Pharmaceuticals and Pershing Square Capital Management. In a press release, the Botox maker said the proposal “substantially undervalues” the company, creates significant risks and uncertainties for shareholders of Allergan and is not in the best interests of the company and stockholders.
“As we have indicated previously, the Allergan board has serious concerns about the large stock component of your proposal, and the recent presentations by both you and Pershing Square did nothing to address the issues we previously raised,” states David E.I. Pyott, Allergan’s chairman and CEO, in a letter to Michael Pearson, chairman and CEO of Valeant. “The Allergan board must seriously consider the many questions around the sustainability of Valeant’s business model as they directly impact the total future consideration for our stockholders.”
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Hedge funds sharply increased their short bets on U.S. interest rates as the flow of economic data improved and inflation figures edged higher, according to the latest Lyxor Weekly Brief from Lyxor’s Managed Account Platform Research team. “Moderate price pressures materialized recently, though the inflation rate remains below the 2 percent target of the Fed,” according to the report, which focuses on hedge fund flows, performance and positioning. “This triggered a rise in 10-year Treasury yields last week … [which] caused some losses on CTAs.” Global macro funds moved their net short positioning on U.S. rates and credit from -9 percent of net assets at the end of April to a current -36 percent.
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Little-known activist hedge fund firm LionEye Capital Management boosted its stake in Wausau Paper by 25 percent, to nearly 2.6 million shares, or 5.1 percent of the total outstanding. In a regulatory filing, Stephen Raneri, the New York–based firm’s CEO, applauds the paper company’s recent moves aimed at boosting its stock price. Back in February he had sent a letter to the board saying he held management accountable for recent performance and expressed support for activists engaged in a proxy fight.
In April, New York–based Starboard Value, which owns 15.1 percent of Wausau, said Gavin Molinelli, managing director of the activist hedge fund, will serve as an observer of the board of directors of Wausau until the earlier of the 2014 annual meeting or September 30, 2014. Starboard also said it was discussing some sort of arrangement for the board’s composition in an attempt to head off its proxy fight.
“The discussions are ongoing and Starboard is hopeful that a mutually agreeable resolution will be reached in the upcoming weeks,” it stated in the filing. On April 2, Henry Newell resigned as chief executive officer of Wausau as part of a wider management shake-up.
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David Harding’s London-based Winton Capital Management has opened a New York office. Winton has also opened a new office in Sydney and plans to open one in Tokyo later this year. The quantitatively-driven firm, which manages more than $25 billion, also recently moved into a new London headquarters. Winton now employs over 305 people, including 140 scientific researchers with PhDs and masters degrees. Winton also said it hired Stephen Stonberg as a senior consultant, based in the New York office. He previously was a managing director of Credit Suisse Asset Management and a partner with Brevan Howard Asset Management as head of business development in London, before moving over to New York and eventually becoming CEO of Brevan Howard US.
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Greenlight Capital short-sale disaster Keurig Green Mountain jumped another 1.12 percent after announcing a business arrangement with sandwich giant Subway. The stock is roughly double its November low and just shy of its all-time high of $123 or so.
