The Morning Brief: Scandal-Wracked Visium Closes

June 20, 2016   Stephen Taub


Visium Asset Management is shutting down. The New York hedge fund firm, which focuses on health care investing, has been caught up in an insider trading scandal and agreed to sell its Visium Global Fund to New York asset manager AllianceBernstein, according to a variety of media reports. In addition, it is liquidating its flagship fund, the Visium Balanced Fund. The firm headed by Jacob Gottlieb was managing $8 billion at the start of the year, up 23 percent from $6.5 billion the previous year. Under the deal with AllianceBernstein, Visium will transfer the fund’s management and staff along with the assets. Last week three former portfolio managers of Visium, including Gottlieb’s former brother-in-law, as well as a government official were criminally charged for their roles in several securities violations. The four were also separately charged by the Securities and Exchange Commission, which brings civil cases. This year the Visium Global Offshore Fund was down 2.3 percent through June 3. It was up in the low to upper teens in three of the four previous years, including more than 10 percent last year. The Balanced fund, managed by Gottlieb, is down more than 9 percent through early June.

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John Paulson, founder of New York-based Paulson & Company, is the latest hedge fund titan to support Donald Trump’s bid to become the next U.S. president. According to The New York Times, Paulson will be co-hosting a fundraising event on Tuesday in an undisclosed location for the real estate developer and reality TV host, along with Stephen A. Feinberg, the founder of Cerberus Capital Management, and real estate big-wig Peter Kalikow. Attendees are shelling out $50,000 for a ticket while the hosts are paying $250,000 per couple, according the report. So much for Republican Trump’s promise to personally finance his campaign. We earlier reported that other hedgies to support Trump include Julian Robertson, Jr. of Tiger Management, Anthony Scaramucci of SkyBridge Capital and Steven Mnuchin, a former Goldman Sachs executive and son of former Goldman partner Robert Mnuchin.

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Balyasny Asset Management disclosed it bought one million shares of Tesco Corporation. This boosts the Chicago firm’s stake to 5.68 percent of the British retailing giant.


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