Two of Baupost Group’s recent biotech investments enjoyed big bounces Wednesday. Shares of Paratek surged 17.4 percent, to $34, on more than quadruple the stock’s average daily volume. The stock has now virtually doubled in just the past eight trading days. We recently reported that Boston-based Baupost disclosed that it owns 12 percent of the Boston-based drug company. Shares of Atara Biotherapeutics, another biopharmaceutical development company, surged 24 percent, to close at $30.18. The stock is up 34 percent in just the past two days. Baupost owns 12.86 percent of Atara’s shares.
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Total assets in hedge funds rose by 1.8 percent in November, to $3.07 trillion, according to industry tracker eVestment. Most of the gains resulted from performance; just $5.4 billion of net new money flowed into hedge funds last month. Altogether, total net inflows for the year-to-date have amounted to $112.2 billion. “Investor interest returned to equity-focused strategies in November,” eVestment notes in its monthly report. “This is important because the volatility and losses from September and October set the stage for end-of-year redemption requests. While this may still occur in December, the inflow in November indicates a healthy level of investor interest remains.”
The firm also notes that fund flows into credit funds were positive last month after more investors redeemed than contributed to this strategy in October. This is significant given that certain credit strategies have lost money for the past five months.
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Man Group has made yet another acquisition. The London-based asset management giant is acquiring Silvermine Capital Management, a Stamford, Connecticut-based leveraged loan manager with $3.8 billion of funds under management across nine active collateralized loan obligation (CLO) structures as of November 30. The deal is expected to close in the first quarter of 2015. Silvermine, wholly-owned by its founders and senior staff members, will be integrated into one of Man’s hedge fund units, Man GLG. The acquisition comes after Man’s recent acquisitions of Pine Grove Asset Management, Numeric Holdings and the Merrill Lynch Alternative Investments fund of hedge fund portfolio.
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Affiliated Managers Group has announced “a meaningful increase” in its minority stake in AQR Capital Management. However, the vaguely-worded press release did not provide further details regarding the terms or the size of the investment. All it says is that when the deal is completed, AQR’s 21 principals, including founders Clifford Asness, David Kabiller, and John Liew, will still hold a majority of the firm’s partnership interests and operate the firm independently. Greenwich, Connecticut-based AQR was founded in 1998 and manages $115 billion in assets, which includes traditional and alternative strategies. AMG, which is publicly-traded, says the additional investment will boost economic earnings per share by about $0.60 in 2015. The stock surged 6.9 percent, to close at $202.55, on Wednesday.
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The Rhode Island State Investment Commission confirmed it is getting out of its $61.8 million investment in New York-based hedge fund firm Mason Capital Management, which it has had since January 2012, according to the Providence Journal. The paper noted that the value of the Mason investment rose by an average of 1.02 percent per year in the nearly three years since it made its initial investment.
“Given liquidity constraints, at the last SIC meeting the Commission elected to redeem from Mason Capital, a $60 million investment made in January 2012, rather than commit to another year,” spokeswoman Ashley Gingerella-O’Shea told the paper in a statement. “Over the three years the SIC has been invested, the fund has exhibited less return for the risk taken than expected given its prior track record. The SIC expects to redeploy the proceeds at the January meeting.”
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UBS raised its price target on Darden Restaurants to $54 from $46 and raised its earnings estimates for fiscal 2015 and 2016, but maintained its Neutral rating on the stock. In a note to clients, the investment bank cited the restaurant company’s improving fundamentals, potential positive momentum and four straight months of positive same-store sales at Olive Garden. In October, Jeffrey Smith’s New York-based activist hedge fund firm Starboard Value replaced the entire company’s board of directors after winning a contentious proxy fight.
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Leon Cooperman’s New York-based Omega Advisors disclosed that he owns 7.8 million shares, or 5.41 percent, of Caesars Entertainment, which earlier this week defaulted on $225 million in debt. He owned a little less than 7 million shares at the end of the third quarter.
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Chicago-based Balyasny Asset Management disclosed it owns more than 8 million shares of KBR, or 5.57 percent of the engineering and construction company that was formerly a subsidiary of Halliburton. It owned just 1.1 million shares at the end of the third quarter.
