Tuesday, January 22, 2013

Damn! SAC Blows A Big Investment




According to the WSJ’s Jenny Strasburg SAC Capital Advisors late last year lost a potential investment from a Japanese bank that could have landed the hedge-fund giant hundreds of millions of dollars to manage, a setback for a firm under siege from government investigators and facing significant client withdrawals.

Mizuho Financial Group 8411.TO -0.59% had discussed last year making a major investment that could have brought as much as $500 million to SAC, said people briefed on discussions with SAC executives and advisers.  But the bank ultimately notified SAC that it wasn't proceeding. By December, with scrutiny of SAC's trading practices mounting, the firm's executives told advisers and others inside and outside the firm that Mizuho's decision appeared final…..


SAC is preparing for clients to withdraw $1 billion this quarter alone, according to people briefed on the firm's internal conversations. A deal with one of Japan's biggest banks could have offset some of those defections, while also helping SAC attract more clients and increase its investment business in Asia, one person close to the firm said.


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