(August 20, 2012, New York) Bloomberg reports that Knight Capital rejected a last-minute, $500 million rescue-loan offer from Citadel LLC on Aug. 5 as it worked on a competing plan from a group of investors, said two people with knowledge of the matter. The loan terms would have given Citadel a minority stake in Jersey City, New Jersey-based Knight's stock and an interest in the market maker's HotSpot foreign-exchange subsidiary, said the people, who spoke on condition of anonymity because the talks were private. Citadel, the $12.5 billion hedge fund run by billionaire Ken Griffin, competes with Knight's market-making and electronic-trading business.
Citadel, which had walked away from a previous round of talks on Aug. 4, made the offer as Knight Capital was completing a $400 million capital infusion from a group of investors led by Jefferies Group Inc. (JEF) That transaction, which was completed yesterday, gives the new investors rights to take a more than 70 percent stake in Knight. In Citadel's offer, shareholder dilution would have been between 10 percent and 20 percent, according to another person familiar with the offer.
"Knight explored a wide range of alternatives," Kara Fitzsimmons, a spokeswoman for Knight Capital, said in an e- mailed statement. "After a thorough review, Knight determined that the $400 million equity investment was the best and only alternative for the company and its shareholders." Why so? That will be known on September 25 in New York, October 9 in Chicago and December 12 in London, when hundreds of the most important players in alternative investments will gather for all-star agendas at Hedge Funds Leaders Forum 2012, "Getting Ready to Manage $5 Trillion by 2016" (http://www.HedgeFundsLeadersForum.com). A virtual who's who will soon follow as one legendary manager after another will take the stage. Billions of investable assets will be represented by influential local and international investors who will listen with rapt attention as star managers and analysts discuss and debate the biggest issues facing the industry today.
Hedge Funds Leaders Forum 2012, "Getting Ready to Manage $5 Trillion by 2016" will provide attendees in New York, Chicago and London with the most up-to-date review of where this ever-changing industry stands and how regulatory and alpha expectation s will impact it. Recognized managers, investors, experts, regulators, and strategists will return to Hedge Funds Leaders Forum 2012 to provide the information practitioners are looking for in an open and unbiased environment, highly conducive to the most efficient and effective networking.
Hedge Funds Leaders Forum 2012 is produced by Golden Networking (http://www.goldennetworking.net), the premier networking community for business executives, entrepreneurs and investors. Panelists, speakers and sponsors are invited to contact Golden Networking by sending an email to email@example.com.
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