As I understand it the new investor own 90% of the fund (thus the net equity. They put in $3.6 Billion, and if I recollect correctly the news, the current net equity is down to $4 billion (with the new injection). It also means they own 90% of all the hedged holdings, but Weil's comment was that he "is buying in" at a price of 10% of what the fund originally bought in (namely, the trade went the wrong way, and if they would have been to force to close the hedges, they would have been wiped out, Weil must think that the "spread" will renormalize, and hopefully he knows, other wise, in another few weeks they may have to come up with another $4 billions).
Zeev |
