DealZone

Comeback kid?

federaltrust1.jpegJay Sidhu is back.

The former chief of Sovereign Bancorp has a tentative deal to invest $30 million in Federal Trust Corp and take control of the small Florida-based savings and loan. Federal Trust Bank operates 11 full-service offices and had total assets of $639.8 million as of June 30.

About two decades ago, Sidhu started down a similar path, when he took over as chief executive of Sovereign. By the time he left had transformed a $400 million Pennsylvania thrift into a regional bank with some $89 billion in assets and 800 branches, stretching from Maryland to Boston. Under Sindhu, Sovereign acquired more than two dozen banks and branch networks divested by bigger banks.

But Sidhu, who stepped down from the bank in 2006, was also a magnet for criticism. Disgruntled investors complained about Sovereign’s stagnant share price, and his agreement to sell a minority stake to Spain’s Santander and simultaneously buy Brooklyn, New York’s Independence Community Bank Corp.

Critics also decried Sovereign’s corporate governance, accusing Sidhu of controlling his board by granting directors exorbitant pay and lucrative inside deals.

The New Delhi native has apparently been planning a comeback. He controls Sidhu Advisors, an investment vehicle. And in March, he filed with regulators for an IPO of Sidhu Special Purpose Capital Corp, blank-check company, to raise up to $150 million.

Sam Israel’s wooded hideout

Prospect MountainGRANVILLE, Mass. — Hedge fund managers are known for having a taste for the world’s glamorous vacation spots. But for his time on the lam, fugitive and one-time millionaire Samuel Israel hid out in a place that typically caters to people of more modest means – a campground in rural Granville, Massachusetts, according to some of the camp’s current guests.

“It’s different, that’s for sure,” said Ken Cudworth, 37, as he moved his family into a site at the campground. Cudworth had been waiting for an opening at the wooded camp for a few days and got a call on Wednesday morning that one had opened up – the site that Israel, who was convicted of a scheme that defrauded investors of $450 million, vacated when he turned himself in at a local police station.

Cudworth“I’ll be digging some holes to see if he left anything,” Cudworth said.

Jim Cooley, 63, also staying at the camp, said he’d seen a man who matched Israel’s description pull out of the site on a motorscooter. That was the vehicle Israel rode to Southwick police station where he turned himself in after a four-week nationwide manhunt for the person who committed the longest-running fraud in the $2 trillion Campground Jailhedge-fund industry.

On the road with Sam Israel

The U.S. Marshals say this vehicle has been driven by fugitive hedge fund manager Samuel Israel, who is wanted for failing to surrender to serve a prison sentence. (REUTERS/U.S. DEPARTMENT OF JUSTICE/HANDOUT)BOSTON – It’s no Maserati. The fuel-hungry, possibly damaged 2007 Coach Freelander Recreational Vehicle is the antithesis to the flashy, often glamorous stereotype of powerful hedge fund managers.

But it appears to be the getaway vehicle of choice for fugitive former hedge fund manager Samuel Israel III.

And unlike the larger than life returns Israel promised investors, the vehicle is big. Really big.

McSweeney’s: “Word problems for future hedge-fund managers”

Online humor site McSweeney’s has compiled a tongue-in-cheek list of math and logic problems:

Your middle-class parents have a combined household income of $115,000. You receive an allowance of $20 per week. If you save all your allowance for two years, how much debt will you have to finance to hostilely take over your family? How will you structure the debt?

from Summit Notebook:

PequotVentures exec trumpets Big Apple advantage

lenihan.jpgPequotVentures, the venture capital arm of hedge fund Pequot Capital Management, has shut down its Silicon Valley office and now operates only out of New York. Managing general partner Lawrence Lenihan said the contrarian move made sense because the plethora of venture capital operators in Silicon Valley forced PequotVentures to compete on price.

That's not so true in New York, where there's less competition on the fund side but lots of promising media and finance businesses, he told the Reuters Hedge Fund and Private Equity Summit on Tuesday.

New York is also looking like increasingly fertile ground relative to Boston's once booming Route 128 corridor. Lenihan, who admits that as a New Yorker he may carry a certain bias, said that shuttle flights which once were packed with New York investors going to Boston to check out companies are now carrying many more Boston investors in the opposite direction.