Explaining Southern California's economy

Who is Steven Cohen? The lowdown on the hedge-fund legend who wants to buy the Dodgers

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Harry How/Getty Images

Clayton Kershaw and teammates of the Dodgers celebrate a two run homerun of Matt Kemp for a 2-1 win over the St Louis Cardinals at Dodger Stadium on April 17, 2011.

As KPCC's Corey Moore reported yesterday, billionaire hedge fund king Steven Cohen wants to buy the Los Angeles Dodgers. You'll recall that owner Frank McCourt, mired in an acrimonious divorce proceeding and dueling with Major League Baseball Commissioner Bud Selig, put the team into bankruptcy in June. That desperate gambit failed and McCourt has given up the fight. The team now has to find a new owner by April 2012.

Enter Cohen, with an estimated net worth of $8 billion, but more importantly, a reputation as Wall Street's most successful — and controversial — trader. In fact, few men more perfectly represent the ascent of the swashbuckling trader on the Street than Cohen, who started his hedge fund, SAC Capital Advisors, in 1992. It's now worth $12-$14 billion.

With coin like that, Cohen could easily afford to bid for the Dodgers, whose value has been pegged at around $1 billion.

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Microsoft is back in the driver's seat on Yahoo deal

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Justin Sullivan/Getty Images

A Yahoo! billboard is visible through trees in San Francisco, California.

I used to think that Microsoft should buy Yahoo. It didn't in 2008 — although that was less about Microsoft than it was about Yahoo's unwillingness to sell. Now that Yahoo has entered something of a tailspin, canning its CEO and exploring some sale options, Microsoft is back. And oh boy! What a deal it's looking to make.

But I now don't think Microsoft should buy Yahoo.

This is from the Wall Street Journal:

Potential suitors said they believe Yahoo’s inherent value is lower than its current share price of about $16.12, which they say includes a “deal premium” reflecting investors’ anticipation of the sale of Yahoo, people familiar with the matter said. The stock has run up since Carol Bartz was ousted as chief executive last month and Yahoo launched a strategic review.

In 2008, Microsoft was offering $31/share. It's traded as low as about $11. I'd say it's worth way more than $16, but in any case, Microsoft is now positioning itself to take a sweet stake, in preferred shares. I think this lessens the chance that I'll get my wish, which is to have Yahoo shed its identify as a tech company and remake itself as a Southern California-based online entertainment juggernaut. Microsoft doesn't need to be buying it. Disney does.

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