Highfields Capital Management

Last updated
Highfields Capital Management LP
Company type Limited Partnership
Industry Hedge funds [1]
FoundedJune 15, 1998;26 years ago (1998-06-15) [2] [1]
Headquarters
Boston, Massachusetts [1]
,
U.S.
AUM US$12.1 billion (2018)
Website www.highfieldscapital.com

Highfields Capital Management LP is a hedge fund founded in 1998 which had assets of $12.1 billion in 2018. [3] [4] The annualized net returns during the firm's first 20 years were more than 10%. [5]

Contents

Business

Richard Grubman and Jonathon Jacobson met at an investment lunch in New York City in the early ‘90s and started a friendship. In 1998, they opened Highfields Capital Management LP together in Boston, Massachusetts. [6]

Highfields has invested in publicly traded equities and private companies like Harry & David, Michaels, Genworth Financial, Microsoft [7] and SLM Corporation; [8] and other investments including reinsurance sidecars. Grubman and Jacobson gained attention and a large payoff when they bet against Enron before the 2001 bankruptcy. [9] In February 2012, Highfields called for management change at CoreLogic, [10] in which it had a 7.65% stake. [11]

In 2010, Highfields was listed as having $10 billion of assets on January 1, 2010, 30th in The Hedge Fund Journal Top 50, up from $9.3 billion on July 1, 2009 and up from a 38th-place ranking in 2008. [12]

In 2013, Highfields returned $2 billion to clients. As Jacobson wrote to investors, "we would rather be slightly smaller and generate better [returns]." [13]

In October of 2018, Highfields announced in a letter that they would return all outside capital [14] and would convert into a family office. [15] In a third quarter letter to investors, Jacobson wrote, “Done correctly, money management is an all-consuming, 24/7 pursuit… After three-and-a-half decades of sitting in front of a screen, I realized I am ready for a change." [16]

Over the 20 years between 1998 and 2018, Highfields only lost money in two years: 2002 and 2008. [9]

Senior management

Richard Grubman and Jonathon Jacobson co-founded Highfields Capital Management LP in 1998. [12]

Grubman retired in August 2010; Jacobson remains a principal of the firm. [17]

Jacobson is an undergraduate alumnus of Wharton School in finance and has an MBA from Harvard Business School. [11] After working as an options trader and at Merrill Lynch and Lehman Brothers, he joined Harvard Management Company in 1990. [18] In 1998 Jacobson left HMC to co-found Highfields with a third of the fund's initial $1.5 billion under management coming from HMC. [11] Bloomberg reported in 2011 that Harvard Management Company no longer invested with Highfields. [19]

References

  1. 1 2 3 "Company Overview of Highfields Capital Management, LP", businessweek.com. Retrieved March 27, 2012.
  2. ↑ "HighfieldsCapital.com WHOIS, DNS, & Domain Info - DomainTools". WHOIS . Retrieved 2016-08-14.
  3. ↑ "Highfields shutting down $12.1 billion hedge fund". Pensions & Investments. 2018-10-04. Retrieved 2020-01-06.
  4. ↑ "6 who dodged the Bear Stearns bullet - Highfields Capital Management (5) - FORTUNE". money.cnn.com. Retrieved 2020-01-06.
  5. ↑ Chung, Juliet (3 October 2018). "Hedge Fund Highfields Capital To Return Money to Clients". Wall Street Journal. Retrieved 2020-01-06.
  6. ↑ JOURNAL, David Armstrong and Henny SenderStaff Reporters of THE WALL STREET (2005-02-16). "Highfields Capital Has Agitator Past". Wall Street Journal. ISSN   0099-9660 . Retrieved 2020-01-06.
  7. ↑ Ovide, Shira (2013-09-04). "Microsoft Investor Highfields Reacts to Nokia Deal". WSJ. Retrieved 2020-01-06.
  8. ↑ "Hedge fund managers look to lenders and banks". Reuters. 2010-05-27. Retrieved 2020-01-06.
  9. 1 2 "Hedge fund Highfields to shut down, founder says in client letter". Reuters. 2018-10-03. Retrieved 2020-01-06.
  10. ↑ "Highfields Calls for Ouster of CoreLogic's Management" [ permanent dead link ], New York Times, February 28, 2012. Retrieved 2012-11-07.
  11. 1 2 3 "Highfields Capital Management", Hedge Fund Letters, n.d. Retrieved 2012-11-07.
  12. 1 2 McIntosh, Bill, ed., "The US50", The Hedge Fund Journal in association with Newedge Prime Brokerage Group. Retrieved 2012-03-27.
  13. ↑ "Highfields Capital to return up to $2 billion to clients". Reuters. 2013-10-02. Retrieved 2020-01-06.
  14. ↑ "Highfields is Latest High-Profile Hedge Fund to Shut Down". Institutional Investor. Retrieved 2020-01-06.
  15. ↑ "Vinik to shut down hedge fund, says raising cash 'much harder' than expected". Reuters. 2019-10-23. Retrieved 2020-01-06.
  16. ↑ Chung, Juliet. "Hedge fund Highfields Capital to close, return billions to clients". MarketWatch. Retrieved 2020-01-06.
  17. ↑ "Hedge Fund Manager Who Threw Keys at a Valet is Retiring for Family Reasons".
  18. ↑ "Hating to Lose" (PDF). Value Plays. January 6, 2020.
  19. ↑ Wee, Gillian, "Harvard's Crimson Cubs With $43 Billion Dwarf Their Former Endowment Home", Bloomberg, March 2, 2011. Retrieved 2012-11-07.
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