Looking back at the BP oil spill and Tepper’s Hamptons starter home

June 14, 2011   Suzy Kenly Waite

AR also compares the success of the Robin Hood fundraiser five years ago and today.

One year ago

»» BP’s oil spill became the largest environmental catastrophe in American history. Although BP was not a big hedge fund play, many funds were invested in Transocean, the Swiss company that owned the blown rig.

In the first quarter of 2010, Transocean’s largest shareholders included oil tycoon Boone Picken’s BP Capital Management (no relation to British oil company) and Leon Cooperman’s Omega Advisors, in addition to a host of other blue chip hedge funds . From the time of the explosion in April to mid-June 2010, Transocean’s shares fell about 50%, from $86.96 on April 19 to $46.85 on June 11.

BP Capital Management got out of Transocean a few months after the spill, selling all of its shares by September 2010. Cooperman also sold, though he still liked the company. Omega later reinvested and the firm held 777,600 shares in Transocean as of March 31, 2011, when the shares were at $77.95. The stock closed at $62.23 on June 13.

»» David Tepper hit the Hamptons. A few months after AR crowned the founder of Appaloosa Management last year’s highest hedge fund earner (Tepper brought home $4 billion in 2009), he purchased a 6,165-square-foot mansion with an ocean view in Sagaponack for $43.5 million. Tepper bought the property from former Goldman Sachs chief executive (and former New Jersey Governor) Jon Corzine. It was the most expensive Hampton’s purchase of 2010.

It turns out the mansion wasn’t big enough for Tepper. In June, he tore it down, and is reportedly building a house that will be twice its original size. This could be a case of Tepper keeping up with the Joneses: mutual fund investor Ron Baron’s East Hampton home is about 28,000 square feet, while junk-bond tycoon Ira Rennert’s house is a whopping 110,000 square feet.

Five years ago

»» The Robin Hood Foundation raised a then-record $48 million at its 17th annual benefit. The event was hosted by The Daily Show’s Jon Stewart and featured entertainment by Beyoncé Knowles. Glenn Dubin, co-managing member of Highbridge Capital Management and Jim Pallotta of Tudor Investments, were co-chairs of the event.

In 2010, Robin Hood raised a new record of $87.8 million thanks to a large matching gift from George Soros. This year, the star-studded event featured performances by Lady Gaga and Tony Bennett, yet the amount raised fell short the 2006 level, with the foundation bringing in $47.7 million. A portion of this year’s money will go toward assisting impoverished veterans seeking housing, job training, healthcare and counseling.

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