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December 2, 2004 09:37 AM

Nothing Ventured, Everything Gained


Excerpt: A new trading tactic that could tip proxy fights and takeover battles has emerged from the shadows of the hedge fund industry, igniting outrage among some investors and corporate governance experts.


A new trading tactic that could tip proxy fights and takeover battles has emerged from the shadows of the hedge fund industry, igniting outrage among some investors and corporate governance experts.

The tactic is a complex hedging technique that allows an investor to buy a voting stake without actually holding an economic interest in the company. While Wall Street has long speculated about such a tactic, it was not until this week that the first signs of such a strategy were disclosed amid a takeover fight for King Pharmaceuticals, a generic drug maker, by its larger rival, Mylan Laboratories.

The Perry Corporation, a New York-based hedge fund, owns seven million shares of King, hoping to profit from the spread between the price Mylan offered for King shares, $16.49, and King's actual share price, which closed yesterday at $12.42. If the deal is completed, Perry stands to make over $28 million, based on figures in a filing with the Securities and Exchange Commission on Tuesday.

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Dollar Struggles From New Lows (December 02, 2004)
The dollar struck another record low against the euro and a five-year low on the yen Thursday, while bonds were little changed following a mixed jobless claims report. Early morning in New York, the euro was unchanged from late Wednesday at $1.3323, with the dollar ...
Why Consumers Hate Mergers (December 02, 2004)
Renee Roberts of Antelope, Calif., still gets steamed when she thinks about what happened to her after Comcast bought AT&T Broadband for more than $50 billion two years ago. She says the company lost her $155 payment in its newly integrated automated system -- and ...
The Right (and Wrong) Way To Protect Yourself Against The Falling Dollar (December 01, 2004)
What if the buck doesn't stop here? Investors are shoveling money into foreign-stock and bond mutual funds, hoping to profit from the tumbling dollar. I fear, however, that many of these folks will be a tad disappointed. According to the Investment Company Institute in Washington ...
Fidelity Tightens Trading Policy (November 30, 2004)
Fidelity Investments, the biggest U.S. mutual fund company, said Tuesday that it has strengthened policies designed to combat excessive short-term trading in its funds. "Frequent purchases and sales of fund shares can harm shareholders in various ways, including reducing the returns to long-term shareholders by ...

Read all 40 posts in the same category of Investment:

Gifts to Fidelity Employees Attract Investigators - Dec 17, 2004
Bottom Line at Fannie Mae: Looking Safe vs. Being Safe - Dec 17, 2004
Assessing What Will Now Happen to Fannie Mae - Dec 17, 2004
Brokerages Battle for 'Active Traders' - Dec 14, 2004
Taxable And Tax-Exempt Not So Different? - Dec 11, 2004
The Dollar Dilemma - Dec 08, 2004
Fear Itself - Dec 08, 2004
Wall St. Turns To The Time Out As Punishment - Dec 08, 2004
How To Profit On A Weak Dollar - Dec 08, 2004
Zhou Comments Boost Yuan Forwards - Dec 07, 2004
SEC: Hedge Fund Advisers Must Register - Dec 06, 2004
Should You Be Buying Gold? - Dec 06, 2004
Money Market Funds Reinflate Fees - Dec 06, 2004
The Tax Man May Take a Bite - Dec 05, 2004
China Pledges Stable Policies - Dec 05, 2004
The Insiders Are Selling. But Is That So Bad? - Dec 05, 2004
Fed President: Measured Hikes Ahead - Dec 03, 2004
Funds Take In $14 bln In October - Dec 02, 2004
Google CEO Proud Of Dutch Auction IPO - Dec 02, 2004
Dollar Struggles From New Lows - Dec 02, 2004
Why Consumers Hate Mergers - Dec 02, 2004
The Right (and Wrong) Way To Protect Yourself Against The Falling Dollar - Dec 01, 2004
Fidelity Tightens Trading Policy - Nov 30, 2004
A Lesson for Social Security: Many Mismanage Their 401(k)s - Nov 30, 2004
Chip Index To Get Makeover - Nov 30, 2004
Gold ETF Could Open Door To Commodities - Nov 29, 2004
Has Social Investing Lost Its Way? - Nov 28, 2004
Study Links Personality Type to Investing - Nov 27, 2004
Advantages That VIPERs Bring to Exchange-Traded Funds - Nov 27, 2004
The Other Side of Vanguard - Nov 26, 2004
The School-Savings Plan With a 'Huh?' Name - Nov 26, 2004
In Tug-of-War on Stocks, Some Pull Away From the U.S. Market - Nov 24, 2004
Scary Bonds - Nov 22, 2004
Taxpayers With IRAs: FYI: The IRS Does Not Approve IRA Investments - Nov 22, 2004
Investing in Rare Coins - Nov 22, 2004
Day Trading Ads: Cutting Through the "Bull" - Nov 22, 2004
A Bond Strategy Once Thought Foolish Now Looks Smart - Nov 17, 2004
Small Boost for I Bond; EE Looks Like A Better Deal - Nov 06, 2004
I Bond Should Hold Steady, But EE May Jump - Nov 03, 2004