Transocean announced a settlement with Carl Icahn, which will result in the famed septuagenarian investor obtaining two board seats of the company. One seat will go to Samuel Merksamer, who was earlier elected to the company’s board at its 2013 annual meeting, and the other will go to Vincent Intrieri. The supplier of oil rigs and other equipment also agreed to award a special $3 per share dividend, a popular demand by Icahn and other activist investors. Transocean also agreed to reduce the size of its board to 11 from 14, giving Icahn’s representatives a bigger say. Also, Transocean agreed to create a master limited partnership around the middle of 2014. Finally, the Vernier, Switzerland-based company agreed to margin-improvement measures that would result in $800 million in savings by the end of 2015. Transocean was the owner of the infamous Deepwater Horizon drilling rig that exploded and sank, resulting in BP’s historic 2010 oil spill in the Gulf of Mexico.
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Speaking of Icahn, shares of his holding company, Icahn Enterprises, experienced their sixth straight sharp move in either direction, dropping more than 4 percent to close at $114.92. Still, the stock trades at about 13 percent above its price when this roller-coaster ride began.
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Rhodium Capital, a new hedge fund run by former Bank of America trader Iftikhar Ali, has deployed a chunk of its initial $30 million in capital into corporate bonds. “The stormy summer market caused a correction, but now the big scares are out of the way, so we see further spread compression from here,” said Ali, according to a Reuters report citing a Rhodium document. Ali has generated an average annual return of 16 percent since 2005, according to the report.
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Jack Inglis has been named the new CEO of The Alternative Investment Management Association (AIMA), the global hedge fund trade group. He was previously a member of Barclays’ global executive committee for prime services. Before that he was CEO of London-based hedge fund firm Ferox Capital. Inglis also spent 16 years at Morgan Stanley, where he was co-head of European prime brokerage from 2003 to 2007. Inglis replaces Andrew Baker, who had been CEO since the beginning of 2009.
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Shares of Facebook fell for the fourth straight day, finishing at $46.19, down about 15 percent from its high three weeks ago. It is one of the year’s hottest stocks that is notably absent from many high-profile hedge fund portfolios.
