Tilson's New Firm

[zarley]

Looks like Whitney Tilson is parting ways with Glenn and T2 Partners.  His bio at the VII conference site now references Kase Capital. 

 

http://www.valueinvestorinsight.com/behindvii/whitneytilson

 

Whitney Tilson is the co-founder and Chairman of Value Investor Media, Inc., founder of Kase Capital, which manages value-oriented private investment partnerships, and Chairman of The Value Investing Congress.

 

I'm pretty ambivalent about Tilson; he seems like more of a (self)promoter than an investor.  But I do wonder what, if anything, happened with T2 to make the split. 

[kiwing100]

 

FYI, here is an analysis of the portfolio of T2 partners.. Interesting that they had 37% of their NAV in call options and warrants ..

 

http://www.zerohedge.com/news/t1-not-t2-goodbye-whitney-tilson

 

 

[zarley]

I saw that link to zero hedge.  I tend to avoid that place whenever possible.

 

As for the bashing of his use of calls, in this case a lot of it was BRK calls which he probably made decent money on (particularly if he still holds them now).

[maxprogram]

I think ZeroHedge is wrong here. I am 90% sure those are the notional value of the options. In other words, that's how much exposure they have on the upside but not how many shares they actually own. So call options are not actually 37% of the fund. Someone can correct me if I'm wrong here.

[Rabbitisrich]

You are right, but it looks like the author is playing with semantics to enhance his implication of excessive leverage. He uses the term equivalents but then uses the full notional values to suggest high leverage on invested capital.

[zarley]

A little more info from the WSJ:  http://blogs.wsj.com/deals/2012/07/19/hedge-fund-t2-splits-tilson-sells-repurchases-berkshire-stake/

 

Well-known hedge fund T2 Partners liquidated most of its stock positions last month as the two managers parted ways, according to a letter to investors.

 

Tilson will become the sole manager of T2 Partners while Tongue is moving on to start his own investment firm Deerhaven Capital Management, the letter says.

 

“After careful consideration, we have decided to cease managing money together and will instead do so independently,” the two wrote. “The friendship and admiration we have for each other is unchanged.”

 

Goes on to say Tilson will keep a lower public profile.  Yeah, we'll see about that.

[Parsad]

A little more info from the WSJ:  http://blogs.wsj.com/deals/2012/07/19/hedge-fund-t2-splits-tilson-sells-repurchases-berkshire-stake/

 

Well-known hedge fund T2 Partners liquidated most of its stock positions last month as the two managers parted ways, according to a letter to investors.

 

Tilson will become the sole manager of T2 Partners while Tongue is moving on to start his own investment firm Deerhaven Capital Management, the letter says.

 

“After careful consideration, we have decided to cease managing money together and will instead do so independently,” the two wrote. “The friendship and admiration we have for each other is unchanged.”

 

Goes on to say Tilson will keep a lower public profile.  Yeah, we'll see about that.

 

Not sure what the heck is going on then at T2 according to their letter:

 

http://www.businessinsider.com/whitney-tilson-and-glenn-tongue-part-ways-at-t2-partners-2012-7

 

Tilson is going back to focusing on investment management instead of his other activities, and Glenn is managing their SPAC vehicle.  The general long-short component isn't really different on either side and they will be relatively focused, with Glenn targeting frauds, failed business models, etc.  Beats the hell out of me!  Cheers! 

[nkp007]

Probably had some minor disputes about some positions and rather than let the tension continue to build, decided to split with Tongue on amicable terms.

[wescobrk]

The wsj article quotes tilson as saying he will cut down on cnbc appearances and let performance speak for itself.

 

I never understood why he regularly went on "Fast Money" that literally has positions for a day and has people argue to buy something because it went up. Why would he try and speak to that proile of investor? Wouldn't he want sticky capital?