GLG Partners Hedge Fund

GLG Partners Hedge Fund Tracker Notes

The following piece on GLG Partners, LP is being published as part of our Hedge Fund Tracker Tool, our daily effort to track hedge funds in the industry.

Resource #1: (5.18.09) Hedge-fund manager GLG Partners Inc.'s (GLG) first-quarter loss narrowed on sharply lower fees and expenses, despite a sharp drop in revenue.

Hedge funds have been rebounding slightly in recent months amid the stock-market rally from their worst year on record in 2008. Like many of its peers, GLG has suffered from poor investment performance and investor withdrawals. GLG saw its ... source

Resource #2: (4.13.09) What can you buy for £4.5m nowadays? In the fund management industry, it seems rather a lot. GLG Partners, the London hedge fund, last night completed its acquisition of SG Asset Management UK - a business originally set up by Nicola Horlick, the former Deutsche Morgan Grenfell star manager.

The business, bought from French bank Société Générale, had $8.5bn (£6.1bn) under management at the end of last year, making it one of the cheapest-ever purchases of a fund manager, relative to assets. Henderson is paying £115m for New Star, the crisis-struck manager, which had £49.5bn under management at the end of December. source

Resource #3: (4.1.09) The top three executives at GLG Partners, until recently Europe's biggest hedge fund, have cut their salaries to $1 (69p) as the global financial turmoil puts pressure on senior managers to waive their pay.

Noam Gottesmann and Pierre Lagrange, the "G" and "L" in GLG, and Manny Roman, co-chief executive with Mr Gottesmann, said in a regulatory filing that they had agreed to take $1 in salary from April to the end of the year. They receive no bonus, although all are big shareholders. source

Resource #4: (3.18.09) Last year’s economic cataclysm has reshaped the rankings of the top hedge fund managers in Europe.

Brevan Howard Asset Management took the top spot in Hedge Fund Journal’s annual league tables, displacing GLG Partners. Amidst disastrous performance and huge redemptions suffered by other hedge fund managers, London-based Brevan actually managed to increase its assets under management by almost 28%, to US$23.9 billion. Brevan’s London neighbors GLG, by contrast, saw its assets plummet by 37% to US$15 billion, leaving it in fourth place. source

Resource #5: (2.5.09) GLG Partners has lost an appeal against a €1.5m ($1.9m) fine by the French markets watchdog for insider trading in Vivendi shares, in a blow to the London hedge fund group.

The ruling came as the Autorité des Marchés Financiers, the French regulator, is investigating GLG's trading in shares of Infogrames Entertainment, the software group. source

Resource #6 (11.26.08) Hedge funds have won a majority of seats on the creditors committee overseeing the bankruptcy of Lehman Brothers’ European business.

GLG Partners, Oceanwood Capital Management and Ramius Capital each won a seat on the five-member committee, which will assist receiver PricewaterhouseCoopers in figuring out who is owed what by Lehman Brothers International Europe. Some hedge funds have been extremely critical of PwC, saying it is moving too slowly to free up their frozen assets.

Approximately US$70 billion in prime brokerage assets at LBIE remain frozen, and PwC has said it could take months or years to untangle the mess. Source

Resource #7: (11.11.08) GLG Partners Transcript

Resource #8: (11.2.08) One of Europe’s largest hedge funds, GLG, is sending a letter to investors this weekend saying it is to launch a “liquidity review” of its funds.

It is also going to stop investors making withdrawals from its $1.5 billion (£930m) Market Neutral fund for six months. The review will decide the best way to preserve capital in GLG’s 40 funds.

The Mayfair-based firm, run by founders Noam Gottesman and Pierre Lagrange, will also tell investors looking to quit the $2.5 billion Emerging Markets fund that they will not receive a full return as a tranche of the fund’s investments is too illiquid to sell.

The Emerging Markets fund, which has lost half of its value this year, has been hammered by stockmarket chaos in countries such as Russia where wild price swings have led regulators to suspend trading.

GLG’s top trader, Greg Coffey, who walked away from a $250m share package when he resigned in April, finally left the company this weekend. Source

Resource #9: Here is a letter to investors put out by GLG partners on their homepage earlier this week. It addresses the firm's exposure to Lehman Brothers in midst of that firms bankruptcy.
_____________

Dear GLG Fund Investor,

We wanted to update you about the impact to us arising from the administration proceedings of Lehman Brothers International (Europe) ("LBIE”), and the insolvency proceedings of other entities in the Lehman Brothers group. In total, we currently estimate that the combined direct exposure of the GLG Funds to be approximately $95 million, or less than 1% of GLG's net AUM. We have detailed each Fund’s potential exposure stemming from LBIE's administration in letters to the investors in those Funds.

Our assessment of the LBIE exposure is based upon a number of assumptions (including, that amounts LBIE was required to treat for each Fund as client money and not use in the course of its business were and are, in fact, so held and will be released upon repayment by each Fund of all its debt to LBIE) and in accordance with legal and professional advice obtained. That said, until we are able to fully reconcile our information and assumptions with the administrators of LBIE, our estimates could change. Source: PrimeBrokerageGuide.com

Resource #10: Emmanuel Roman, of GLG Partners, said 25pc-30pc of the world’s 8,000 hedge funds would disappear “in a Darwinian process”, either going bust or deciding meager profits are not worth their efforts.

“This will go down in the history books as one of the greatest fiascos of banking in 100 years,”

But I’m not really sure why. Hedge funds haven’t caused any of the current problems, indeed, many of them, by going short, have reduced the size of the bubble and thus the subsequent crash.

“There need to be some scapegoats, and the regulators are going to go hunt people. Now that is certainly true, and hedge funds most certainly are going to be one of the prime suspects to be those scapegoats. But there’s no good reason why they should be.

Hedge funds are simply investment vehicles, ones that by restricting themselves to only taking investments from sophisticated investors are able to do things that mutual funds and unit trusts cannot because of regulation. They can go short, invest in different classes, commodities, bonds, shares, as they wish. Source

Related to GLG Partners Hedge Fund Tracker Profile:

Tags: GLG Hedge Fund, GLG Partners, GLG Partners LP, GLG Hedge Fund New York, NYC London GLG, GLG Hedge Fund Manaer, GLG Capital Partners Ltd LP LLC

Richard C. Wilson's Blog