Wednesday, May 9, 2012

Facebook and The Best Little Hedge Fund-er You Never Heard Of


According to a Forbes report Christopher R. Hansen is a little-known hedge fund manager who likes to keep under the radar, but his Facebook investment is poised to make him a more high-profile player and is perhaps even helping to fuel his effort to buy a National Basketball Association team. His Valiant Capital Management, a hedge fund firm that he runs out of San Francisco, owns 36.3 million shares in Facebook, according to a Facebook filing with the Securities & Exchange Commission. At $35 per share, the top range of Facebook’s IPO pricing, Valiant’s Facebook stock would be worth $1.27 billion. Valiant probably paid $500 million for the shares, maybe he paid a bit less.

Hansen bought Facebook stock through Valiant Capital Opportunities, a corporation that California business records show was formed in July 2010, just around the time that a relatively large amount of Facebook stock became available. Most of Valiant’s shares of Facebook are held in a special purpose vehicle that its hedge fund investors needed to opt into as co-investors by funneling some of the money they had committed to the hedge fund; the rest of the shares are held in a side-pocket of the hedge fund, according to an individual familiar with Valiant’s structure. Facebook facilitated the deals between Valiant, which the company viewed as an acceptable investor that would not quickly flip the shares, and holders of Facebook shares, using its right of first refusal on transactions involving its private stock….


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