Ronald Orol at The Street says activist investor Sandell Asset Management appears to hold a strong hand in its dealings with Brookdale Senior Living, which it wants to spin off its real estate. The New York-based investment firm, Orol writes, plans to add to its board presence next spring to try to force such a transaction unless Brookdale's directors act before then. And the pieces are in place for such action — as are two deep-pocketed potential buyers.
For HCP and Ventas, an acquisition of Brookdale or its assets would prevent the formation of a new rival. Any move by Brookdale to spin off its massive real estate holdings into a free-standing REIT would create new competition for HCP and Ventas in the health care REIT industry, people familiar with Sandell argue.
One of the biggest names in the global hedge fund industry likes the look of Delek US Holdings. In a filing with the Securities and Exchange Commision, the managers at Citadel say they now own 5.6 percent of Brentwood-based Delek, which last month said it planned to buy nearly half of Texas-based Alon USA Energy. Chicago-based Citadel, which manages $25 billion in capital, becomes the seventh entity to hold at least 5 percent of Delek.
Shares of Delek (Ticker: DK) are up about 1 percent this morning to $35.75. So far this year, they've climbed about 30 percent.
Hedge fund Lone Pine Capital this week said it has since last August trimmed its stake in Dollar General by almost 5 million shares to 12.9 million, or about 4.3 percent of the Goodlettsville-based retailer. Lone Pine last summer built up its stake in Dollar General as the takeover battle for Family Dollar took shape. Since mid-August, Dollar General (Ticker: DG) is up more than 20 percent.
Making an even more pronounced move out of Delek US Holdings late last year was Steadfast Capital Management, which last spring had doubled its stake in the parent of Mapco to 6.2 percent. The fund run by Robert Pitts Jr. had trimmed its holdings a bit over the summer to 3.1 million shares but got out altogether during the fourth quarter. Stepping in to buy more than 1.3 million of those shares was D.E. Shaw, which now owns 7.2 percent of Delek, up from 5 percent in September.
Delek shares (Ticker: DK) have risen about 5 percent over the past three months.
Financial sector-focused hedge fund Second Curve Capital still thinks local nonstandard auto insurer First Acceptance has lots of potential. Second Curve managers filed papers this week saying they now own more than 3.2 million shares of First Acceptance, which equates to 7.9 percent. That's up from 5.3 percent 10 months ago. The move is something of a doubling down: Since last spring: First Acceptance (Ticker: FAC) has fallen about 10 percent.
Local investment manager Andrew Cunagin caught the eye of many a market watcher late last week when he said high-frequency trading played a big part in his decision to shut down his Rinehart Capital Partners firm, which had less than $100 million in assets and had consistently posted losses since the end of 2011. In a letter to investors, Cunagin — who is based in downtown's SunTrust Plaza — also railed against the many investors and traders who have lost sight of fundamentals and are becoming more and more speculative.
"The frustrating thing is that this is precisely the time when you shouldn't be giving up," Mr. Rinehart said in the interview. "Anyone who shorted the 'dot coms' in the 90s had bad performance, and those ended up being the trades of the decade."