Unstructured Finance

The afternoon deal: Speculating on sheikh’s successor

A day after the body of a prominent Emerati sheikh killed in a glider crash was found in Morocco, speculation is swirling around who will be tapped to take over his job as chief of one of the world’s largest sovereign wealth funds.

Sheikh Ahmed bin Zayed al-Nahayan ran the Abu Dhabi Investment Authority (ADIA), a fund reported to have assets of between $500 billion and $700 billion. He was ranked by Forbes magazine as the 27th most powerful person in the world in 2009.


He was also the younger brother of Abu Dhabi ruler and United Arab Emirates President Sheikh Khalifa bin Zayed Al Nahyan, the man leading the charge to find a successor to head ADIA.

Created in 1976 to manage Abu Dhabi’s bountiful oil proceeds, ADIA has assets ranging from stakes in Citigroup to Britain’s Gatwick airport.

Here are some stories from around the Web on who may soon be in charge of managing those assets:

So much Starbucks coffee to taste (250,000 cups), so little time

mcmartinThink you drink a lot of java? Think again.
Starbucks’ stable of 20 coffee tasters collectively sample 250,000 cups of coffee every year, Scott McMartin, Starbucks’ director of global coffee advocacy told Reuters during a recent visit to the cafe chain’s Seattle headquarters.
Those tasters — who sample the brews sold at Starbucks and the company’s Seattle’s Best Coffee brand — are based in Seattle, Switzerland and in farmer support centers in Costa Rica and Rwanda.
scott2McMartin, who spoke as he slurped a variety of coffees, says great tasters have a mix of natural skill and commitment to craft. (Tasters make a slurping sound as they practically inhale the hot brew — a process that mixes the  liquid with air to help the tongue detect different flavors. Then they swish and spit.) 
Top tasters, like athletes and artists, know that practice makes perfect, said McMartin, who is also a sommelier. 
“It’s a repetitive thing. Your tongue is a muscle,” he said
Starbucks tasters make copious notes and occasionally check that they are in sync with regard to what they’re tasting in the cup. The latter process helps Starbucks make sure there are no “rogue tasters” in the mix, McMartin said.

(Reuters photos)

Revolution! Jersey-style

jersey.jpgThe corridors of power are pokey in the government buildings of St Helier, capital of Jersey, the British island tax haven off the coast of northern France.

Some 53 elected legislators representing the island’s population of around 91,000 people are forcedto share eight computers lined up call-centre style in a chilly room on the ground floor of the States Assembly building.

This forced proximity between the island’s politicians could get increasingly awkward on account of a growing left-of-centre political movement challenging the hegemony of Jersey’s financial services industry, which makes up more than half the economy.

Blockbusted – Icahn cuts stake in troubled video chain

Blockbuster‘s biggest shareholder, and one of the market’s most prominent activist investors, is heading for the door, heaping another note of gloom to the video chain’s hopes to avoid bankruptcy.

Filings show Billionaire investor Carl Icahn cut his stake in Blockbuster by selling more than 13 million shares. Over the past week he trimmed his ownership of the Class A shares to 5.1 percent as of March 29, according to a federal filing. In January he reported a 16.9 percent stake. He also reduced his stake in the company’s Class B shares.

To be fair, Blockbuster is already positioning itself for a trip to Bankruptcyland, having said earlier this month that it might need to file for protection from creditors.

Check Out Line: Visa Out, Amex in at Macy’s

Check out Macy’s dumping Visa for Amex. mUSA-RETAIL/

The department store chain operator has reached a deal with American Express to switch the Macy’s and Bloomingdale’s co-branded credit cards to Amex from Visa. The cards will be issued by Citi.

Macy’s did not say why it made the change. Customers will receive their new card by the end of the year and the cards will have the same credit limits, current balances, historical account information and loyalty program rewards as the current Visa cards.

Retailers count on the store-branded credit card to maintain customer loyalty, while also receiving a font of information in terms of a customers’ purchasing history. They also can account for a big chunk of a retailer’s sales.

Gartmore’s Guy flies back in

Gartmore are embarking on a damage limitation exercise in the wake of the suspension of star fund manager Guillaume Rambourg. His mentor, Roger Guy has rushed back early from holiday to help soothe investors spooked by an internal investigation which appears to have thrown up the possibility certain brokers were being favoured.

The firm was a closed shop last night. We managed to get one source to flesh out the story a little, but Gartmore had clearly decided less was more in dealing with the intense scrutiny that comes when a listed firm comes under fire. We’re expecting senior execs to go on the record today, but it will be the behind the scenes diplomacy from Guy which makes or breaks client confidence in the firm’s funds.

Much was made of the ‘key-man risk’ around Guy when Gartmore listed; investors forced a cut in the IPO price based on the issue and will feel they might have got more considering the 30 percent slump in the wake of Rambourg’s suspension. Just imagine the impact if Guy himself had been implicated.

DealZone Daily

Wednesday’s top stories:

* Australia’s Macarthur Coal rejects a A$3.3 billion ($3 billion) takeover offer from U.S. coal miner Peabody Energy , saying it does not fully value the company and its growth prospects.

* As the number of poison pills, or shareholder rights plans, drops to the lowest level in a generation, corporations face investor pressure against renewing broad takeover defenses but feel a duty to have weapons at the ready to fight off bad offers.

* Ireland hits its banks with a hefty penalty to take loans off their hands and says they need at least 22 billion euros ($30 billion) in extra funds to recover from a property collapse that was worse than feared. AIB says it will sell assets in Poland, Britain and the United States.

Mixed day for banks, HDFC Bank down 3 pct

Mixed day for banks, HDFC Bank down 3 pct The BSE banking index fell 0.5 percent on Tuesday after gaining 3.7 percent over the last four sessions. Shares in HDFC Bank slipped 3 percent in trade and ended as the top Sensex loser. The benchmark Sensex too ended a four-session rally, closing 121 points lower at 17590. The other prominent losers were Axis Bank, which slipped 2.2 percent, and SBI which ended 0.6 percent lower. Some smaller peers however had a good day. Bank of India vaulted over 5 percent to the top of the bankex gainers list, while Karnataka Bank gained 2.3 percent. Seeing the current interest rate environment and with the Reserve Bank widely expected to increase rates in April, will you invest in this sector? http://in.reuters.com/article/economicNews/idINIndia-46771020100309

asdasdasdasdThe BSE banking index fell 0.55 percent on Tuesday after gaining 3.7 percent over the last four sessions.

Shares in HDFC Bank slipped 3 percent in trade and ended as the top Sensex loser.

The benchmark Sensex too ended a four-session rally, closing 121 points lower at 17590.

No “Inshallah” for hedge funds

Islamic funds may well be ”the most dynamic part of the Sharia-compliant sector”, supported by with increasing interest from  deep pocketed investors,  but if you are a hedge fund manager,  Banque Sarasin reckons you have no hope of getting a slice of this Sharia pie.

The Sarasin Islamic Wealth Management Report 2010 says many Islamic investors cannot be persuaded hedge funds are linked to the real economy (one of the tenets of Islamic finance), plus investors are discouraged by short selling which, strictly speaking, is also prohibited.

And before you hedgies say you know a Sharia scholar or two who is comfortable with signing off a fatwa, the necessary backing to any Islamic product,  Sarasin says the “forbidden” label still sticks to hedge funds — “effectively stopping the development of this sector”.