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Sculptor Capital Administration, as soon as one of many world’s largest hedge funds, has agreed to be offered for $639mn in a takeover that ends a bitter struggle between its billionaire founder Daniel Och and his former protégé Jimmy Levin.
New York-based actual property agency Rithm Capital pays Sculptor shareholders $11.15 per class A share, an 18 per cent premium to the fund’s closing worth on Friday. Sculptor’s inventory worth was up 15 per cent in early Wall Road buying and selling on Monday following the deal’s announcement.
The sale worth represents a fraction of the $12bn valuation Och-Ziff Capital Administration — as Sculptor was referred to as on the time — listed its shares at in 2007. The agency’s inventory worth has since collapsed greater than 90 per cent.
Sculptor final 12 months grew to become embroiled in a legal battle with Och, who handed over the reins to the agency in 2018, over Levin’s profitable compensation settlement. The agency’s founder questioned why the board had agreed to grant the chief govt greater than $145mn in pay in 2021 regardless of “a interval of lower than mediocre efficiency”.
Och’s lawsuit alleged that the payout deprived public stockholders together with himself. A director nominated to the Sculptor board by Och resigned final 12 months in protest.
The authorized battle introduced into the open a long-simmering dispute between Och and Levin, who first met when the latter taught Och’s son water ski. He joined the agency in 2006 as an analyst and rapidly rose up the ranks to develop into chief funding officer in 2017 with a $280mn pay package deal that set him aside from a lot of his friends.
Nonetheless, the connection appeared to bitter and Och picked former Credit score Suisse govt Robert Shafir to take over from him. Och stays a big minority shareholder and investor in Sculptor’s personal funds.
Sculptor and Och settled late final 12 months because the hedge fund, which manages $34bn in property, launched a sale course of utilizing a particular board committee that included Och. That board committee on Monday unanimously agreed to promote Sculptor.
The fund shall be held as an unbiased subsidiary of Rithm Capital, with its administration and funding employees remaining in place, the businesses mentioned on Monday. Levin will proceed to guide Sculptor’s funding operations and report back to Rithm’s chief govt Michael Nierenberg.
Levin stands to make greater than $40mn from Monday’s sale, in response to securities filings, including to the a whole bunch of thousands and thousands he has made on the fund. Levin presently owns greater than 14mn Sculptor shares price about $150mn, in response to securities filings.
The New York-based agency, then generally known as Och-Ziff, had a number of controversies throughout Och’s management, most notably in 2016 when it paid $413mn to US authorities to settle bribery costs. It was accused of paying bribes in not less than 5 African international locations — together with prime officers of Muammar Gaddafi’s regime in Libya and the Democratic Republic of Congo — to win enterprise. It rebranded to Sculptor in 2019.
Sculptor didn’t instantly reply to a request for remark.