) is a Londonbasedhedge fundmanagement firm founded byChris Hohnin 2003 which manages The Childrens Investment Master Fund. TCI makes longterm investments in companies globally. The management company is authorized and regulated in theUnited Kingdomby theFinancial Services Authority.
Like most hedge funds, TCI requires investors to commit their capital for multi-year periods. This long-term horizon allows the fund greater flexibility when trading and investing capital independent of any potential ad hoc time constraints.
TCI derives its name from a charitable foundation calledThe Childrens Investment Fund Foundation(CIFF), set up by Chris Hohn and his ex-wife, Jamie Cooper-Hohn. In an example ofventure philanthropy, CIFF initially received a portion of TCIs profits and other donations. CIFF focuses on improving the lives of children living in poverty in developing countries, and has grown to be one of the largest charities in the United Kingdom. After suffering a 43% loss during the 2008 calendar year, as of July 2009 the previous financial year had seen a rebound of over 70% profit and revenue for TCI.1
Through changes set in motion in 2012, the fund and foundation were split up. The fund no longer donates money to the foundation on a contractual basis, though it may do on a discretionary basis.2
TCI has a reputation for aggressiveshareholder activism.3Some criticswho?believe that it has taken an active role in most situations to promote its own agenda under the guise of sound corporate governance and increase shareholder value. TCI has been a major shareholder of the Germanwhere it forced the resignation of the CEO after he refused to abandon his plan to take over theLondon Stock Exchange. In 2007, after acquiring 1% of the shares of major Dutch bankABN AMRO, TCI led an attack demanding the bank split up or sell to the highest bidder to produce shareholder value.4ABN was ultimately split and sold toRoyal Bank of Scotland(RBS),Fortis, andBanco Santanderand was a major contributing factor in the downfall of both RBS and Fortis. In June 2007, TCI failed in its attempt to get the Japanese utilityJ-Power, in which it had acquired a 10% stake, to boost its dividend. The general meeting of shareholders rejected the proposal, prompting a severe selloff in the stock.
In 2006, as a shareholder of bothMittal Steel CompanyandArcelor, TCI supported Mittal Steel in the companysunsolicited takeover offerfor Arcelor. However, when Mittal Steel subsequently attempted to acquire Arcelor Brasil (one of Arcelors subsidiaries) without an appropriate premium, TCI defended the rights of Arcelor Brasils minority shareholders, causing Mittal to raise its offer price more than 55%.citation needed
TCI initiated legal action against the Government of India using provisions in the bilateral trade treaty between United Kingdom and India regarding the under pricing of coal byCoal India Limited,in which TCI holds 1% stake.5
In 2008 the company was suffering from heavy losses but recovered very well and assets under management reportedly stood around $6 billion earlier this year, and at the end of 2010, the company recorded a loss of 80% in profits as a result of reduced investment performance.6
The fund won Eurohedges European Hedge Fund of the Year award in 2004, 2005,720138
Opalesque (3 July 2009).TCI sees big rebound in 2009.
TCI Hedge Fund in Britain Ends Ties to Charitable Arm. 18 June 2014.
NRC Handelsblad (Dutch Newspaper), February 22, 2007
BS Reporter (29 March 2012).TCI starts legal action against Indian govt under UK, Cyprus treaties.
TCI, Jabre, Toscafund, VR lead EuroHedge Awards 2013 winners
Financial Times: Feared fund turns to business of charity By James Mackintosh July 2 2007
Management Today: The new new philanthropists by Ian Wylie October 1 2007
Spectator: The real driving force in the battle for ABN by Matthew Lynn May 9 2007
The Economist: Leader of the swarm July 12 2007
The Independent: Financier in record 230m donation to charity by Arifa Akbar July 3 2007
Wainewright, Will,Whats in a name? The Childrens Investment Fund Management (password access),
Capital asset pricing modelalphabetasecurity characteristic line)
Financial services companies established in 2003
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Articles with specifically marked weasel-worded phrases from April 2012
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This page was last edited on 3 April 2018, at 10:39