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Has Didi Kuaidi got Uber's billion-dollar China business up against the ropes?
Venture Capital
<p>Venture capital-backed taxi app giant Uber has sunk a lot of cash into breaking China. It even raised $1 billion in funding last August purely so it could spin off its China unit and focus on grabbing market share in the country. Unfortunately, Uber’s Chinese rival, Didi Kuaidi, claims the Silicon Valley-based firm’s China business is taking a bit of a beating. </p> <p>By its own reckoning, the Chinese unicorn -- which was formed out of a merger between Didi Dache and Kuaidi Dache earlier this year -- claims it is the market leader in all of 259 cities where is provides private-car hailing service. It also claims a 90% market share in the country’s capital Beijing where the company gets over 1 million ride requests, Forbes reports.  </p> <p>Of course Didi's data should be taken with a large grain of salt, but there are third party reports which still paint an equally grim picture for Uber. </p> <p>Last month, Chinese research firm Analysys International released a Chinese report also showing that Didi leads China’s private-car ride-hailing market by a wide margin, with company representing 83.2% of active users. Uber's share comes in at 16.2%. Ouch. </p> <p>Still, that's 16.2% of a very large market, but is it enough to justify the massive amounts Uber has already piled into its China business?  Uber is now fighting a war on many fronts and it 's looking less likely that it will grow that share by a significant margin.  <br /> Photo: Boxing AIBA</p>
Eclectica climbs in November; Pershing Square – not so much
Hedge Funds
<p>Things are starting to look up for Hugh Hendry.  After getting humbled in August thanks to his large bets on Europe and China, the once-loud but always-entertaining Scot’s flagship fund is up 5.4% year to date, according to Reuters:<br /> British hedge fund manager Hugh Hendry's flagship $71 million Eclectica fund returned 2.2 percent in November and is up 5.4 percent in the year to date, a source familiar with the matter said on Tuesday.</p> <p>Founded in 2005, the London-based discretionary global macro firm runs $250 million across several funds and aims to make high-conviction bets across a range of markets.<br /> It adds that the average global macro fund lost 1.47% through October.</p> <p>Meanwhile, across the pond, Bill Ackman may have a little trouble getting into the holiday spirit:<br /> Hedge fund mogul Bill Ackman’s Pershing Square flagship hedge fund fell 2 percent last month and is down 17 percent for the year, according to an investor.<br /> Interestingly, the New York Post reports that Valeant has climbed 40% since Ackman upped his stake to 9.9% of the firm, making his annus horribilis a little less horrible. Still though, losing 2% when your largest position gained 40% is pretty amazing, and its a wonder why quick-draw fund of funders aren't lining up to withdraw funds from Pershing. Stay tuned.<br /> Photo: Wiki</p>
BHP Billiton lifts copper production
Capital Markets
<p>BHP Billiton seems to be pursuing a Saudi Arabia strategy of squeezing out high-cost producers.<br /> The Anglo-Australian miner boosted its copper production outlook: It expects to maintain output at its biggest mine, Escondida, at 1.2 million metric tons a year for a decade, starting in its fiscal year to June 2017, without any further major investment, writes The Wall Street Journal. (paywall)</p> <p>BHP plans to cut copper costs to $1.08 a pound on average, down about 15% on forecasts for the current fiscal year. That is more than 45% below the spot price.</p> <p>Near-term, this adds low-cost metal to the market. BHP’s additions come as about 1.7 million tons of new copper supply from large projects are forecast over the next two years, according to Barclays. The miner’s guidance suggests it should produce 180,000 tons more in fiscal 2017 from those three mines [Escondida, Spence and Olympic Dam] than expected, based on Macquarie’s forecasts,<br /> Earlier this year the Saudi's upped oil production in order to close down competitors, reduce global supply and support the price of crude. That strategy failed and now the Kingdom plans to tap international bond markets to replenish depleted cash reserves.<br /> Photo: Rich Luhr</p>
It’s beginning to look a lot like Christmas for Jeffrey Gundlach
Asset Management
<p>While Bill Gross marinates in a pool of lawsuits, outflows, and diminishing returns, current bond king Jeffrey Gundlach seems to be well on his way to another happy holiday:<br /> DoubleLine Capital, the investment firm with $80 billion in assets overseen by widely followed co-founder Jeffrey Gundlach, posted net inflow of $1.08 billion in November, the 22nd month it has attracted new money.</p> <p>The Los Angeles-based firm said on Tuesday its DoubleLine Total Return Bond Fund (DBLTX.O) had a net inflow of $895.2 million in November. The fund, with total assets at $51.07 billion, invests primarily in mortgage-backed securities.</p> <p>DoubleLine Total Return is posting returns of 2.53 percent so far this year, beating 99 percent of its category. The DoubleLine Core Fixed Income is posting returns of 1.47 percent, surpassing 92 percent of its category. Both funds are overseen by Gundlach.<br /> Citing an analyst at the fund, Reuters adds that inflows at DoubleLine have jumped from $35 million a month in 2014 to an average of $100 million a month in 2015.<br /> Photo: Nevit Dilmen</p>
M&A advisors under the cosh
Capital Markets
<p>A U.S. court has delivered another blow to bankers' God-given right to make a penny or two. Already overwhelmed by regulations, penalised for fixing interest rate and FX markets and threatened by upstart boutiques and new financial technology, now banks face additional scrutiny for their corporate advice.</p> <p>On Monday, a Delaware court found that Royal Bank of Canada (RBC) had damaged Rural/Metro shareholders because it provided tainted advice on the $728m buyout of the U.S. ambulance company by Warburg Pincus four years ago, reports the Financial Times. (paywall)<br /> The decision [by the Superior Court] upheld a lower-court ruling that the bank had “aided and abetted” the failure of Rural/Metro board members to get the best deal for their shareholders.</p> <p>The lower court found that RBC’s conflicts of interest — it was advising the seller while simultaneously trying to garner financing fees from the buyer — had led it to manipulate the Rural/Metro board into accepting a deal price that had undervalued the company.</p> <p>Suddenly, simple, fee-based M&amp;A services appear to contain far more risk for the bank. As a result, bankers may become more cautious about taking on advisory assignments, and some may steer away from them entirely, bankers and lawyers say.<br /> Photo: Mike Licht<br /> &nbsp;</p> <p>&nbsp;</p>
How affluent millennials are changing the finance industry [INFOGRAPHIC]
Asset Management
We previously showed a set of nine charts that show the views of Millennials on debt, banking, and investing. We also recently showed what Millennials want in a first home. Today’s infographic follows a similar thread, looking at the values of the 15.5 million affluent Millennials in the United States, and what the finance industry will have to do to
$25B institutional manager moves into retail
Asset Management
<p>Pzena Investment Management has a 20 year record managing institutional money, and now it's launching mutual funds.</p> <p>The New York-based firm has created a distribution team to push three new mutual funds, reports Investment News. The $25 billion asset manager is looking to expand its investment base as defined benefit pensions die out, and plans on adding more retail funds. Pzena has already been sub-advising retail products for other managers.</p> <p>The Pzena Emerging Markets Focused Value Fund hold $12.2 million. The Pzena mid-cap fund has $2.8 million, and the Pzena Long-Short Value Investor Fund holds $4.2 million.<br /> Photo: OTA Photos </p>
BlueCrest Capital closing fund to outsiders
Hedge Funds
&nbsp; One of Europe's largest hedge funds it closing its doors to outside money as it transitions to a "private investment partnership." The 15-year-old BlueCrest Capital will return $8 billion to outside investors, reports the New York Times. The firm will exit the hedge fund business to become a private trading platform for partners and employees. BlueCrest cited changes in the hedge
'Tiger Cub' dies
Hedge Funds
<p>Tiger Veda Management is closing after 11 years.</p> <p>Manish Chopra launched his "tiger cub" fund after leaving Julian Robertson's Tiger Management 2005, reports Business Insider. Tiger Veda will return 80% of capital on December 31, with the remainder of capital returned in the first quarter of 2016. The fund held $280 million at the end of September.<br /> "Finding a new 'value' long investment has become a needle in a haystack process, and low hanging fruit are few and far between," wrote Chopra in a memo. "With cash balances increasing even above recent history in 2015, we have disabused ourselves of the notion that we are best served to wait it out patiently." <br /> Photo: ©iStock.com/MarkMalkinsonPhotography<br /> &nbsp;</p>