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The Morning Brief: Commodity Fund Manager Clive Capital Shuts Down

Christian Levett’s Clive Capital is the latest commodity hedge fund firm to shut down. The London-based firm, which has lost money in its main fund each year since 2011, is down to $1 billion in assets after hitting a high of $5 billion at its peak. “We perceive there to be limited, suitable opportunities at this point in the economic-demand and the commodity-supply cycles to enable us ... to generate the strong returns of the past,” Clive reportedly said in a letter sent out to investors on Friday. Levett, a former top Moore Capital commodities trader, posted a 44 percent return in 2008. In 2012, Pierre Andurand closed down his London-based BlueGold fund.

The Securities and Exchange Commission charged another individual for his role in the insider trading scheme operated by Galleon Management hedge fund founder Raj Rajaratnam, who is now in prison. In its civil case, the regulator alleges that Kieran Taylor, a former senior director of marketing for Akamai Technologies, illegally tipped former New Castle Funds consultant and portfolio manager Danielle Chiesi with confidential information about the company’s plans to lower its revenue guidance for 2008. Chiesi then passed on the non-public information to Rajaratnam. Chiesi also provided the information to another friend, Steven Fortuna of hedge fund advisory firm S2 Capital. Taylor himself traded on the confidential information by selling 2,500 shares of Akamai stock that he held in a personal brokerage account to avoid losses of $20,635. Taylor agreed to pay $145,000 to settle the charges and to be barred from serving as an officer or director of a public company. The SEC charged Rajaratnam and Chiesi with insider trading in October 2009 and charged Fortuna the following month.


Starboard Value is throwing in the towel in its battle with Smithfield Foods. The New York-based activist hedge fund firm, led by Jeffrey Smith, said it would vote in favor of the food processor’s sale to Shuanghui International Holdings for $34 after it was not able to find an alternative deal. On September 3, Starboard said it had received non-binding written indications of interest for all of Smithfield’s assets at a price “substantially in excess” of $34 per share. However, it said it was unable to secure a definitive deal for several reasons, citing the restrictions imposed by the merger agreement between Smithfield and Shuanghui and the requirement of structuring a cash bid from a single entity.

Barry Rosenstein’s Jana Partners said it boosted its stake in specialty chemical company Ashland to 6.5 million shares from roughly 5.7 million shares, bringing its total stake to 8.4 percent. It scooped up its most recent shares for between roughly $87 and $92.50 per share. The stock closed Friday at $91.63.

Several Tiger Cubs reported holding stakes in smartphone maker Blackberry, whose stock tanked 17 percent Friday after announcing major layoffs and a charge of more than $900 million. As of June 30, the third largest shareholder was O. Andreas Halvorsen’s Viking Capital. However, it is a small stake in the Viking portfolio. Other holders with small stakes included Philippe Laffont’s Coatue Management and two others who took new positions in the second quarter — Robert Citrone’s Discovery Capital Management and John T. Lykouretzos’s Hoplite Capital Management.

Vornado Realty Trust sold its remaining stake in J.C. Penney in a block trade to Citigroup Global Markets, Inc., at $13 per share.

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