A New York hedge fund that specializes in distressed assets has amassed 5 percent of the stock of newly public hospital chain Vanguard Health Systems.
Senator Investment Group, which was launched as the 2008 financial crisis gathered steam, disclosed its stake of almost 3.8 million shares in a filing with the Securities and Exchange Commission. The move makes it the largest investor outside of private-equity funds run by Blackstone Group and Morgan Stanley, who took Vanguard public in June. The two entities still control about half of Vanguard's stock, with Chairman and CEO Charlie Martin also holding about 5 percent once his exercisable options are included.
Senator, which is led by Doug Silverman and Alex Klabin, received $150 million in seed funding from Blackstone as part of the private-equity giant's broader push into hedge funds in 2008. Said to have been profitable from the outset, Senator managed almost $2.3 billion as of June 30. At that time, the fund also held about $46 million of Community Health Systems' stock.
Shares of Vanguard (Ticker: VHS) are up about 1.4 percent this afternoon. Since going public, they've fallen about 23 percent as hospital operators have been hit by the volatile overall market as well as fears about the impact of the federal debt deal on their reimbursement rates. That drop has pushed the company's market cap below $1 billion.
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