Speaking of revolving doors in a small world, the current UK Chancellor’s Rishi Sunak’s former boss Chris Hohn bags $124 million from Wirecard’s stocks collapsing, a bet which paid off.
Billionaire investor Chris Hohn, a UK activist investor who boasted about “getting dramatic returns that are far more than what you receive on the stock market” has turned his fortune around with a one-time short bet on the demise of Wirecard, a German fintech company offering products and services in areas of mobile payments, e-commerce, digitization, and finance technology.
“Chris Hohn bags $124 million from Wirecard’s stocks collapsing, a bet which paid off”
THE WEALTH TRAINING COMPANY
Chris Hohn bags $124 million from Wirecard’s stocks collapsing centers around the billionaire’s firm The Children’s Investment (TCI) Fund placing a huge bet on Wirecard’s shares falling earlier this year. Chris Hohn, activist investors called for the removal of the firm’s chief executive Markus Braun amid allegations of accounting irregularities.
Wirecard’s shares crashed by more than 80 percent in mid-June after EY, the company’s auditor, refused to sign off its accounts. What was the problem?
It was reported that the auditors could not find €1.9billion of cash that was supposed to be in the business.
The accounting irregularity sent stocks in the fintech company crashing as Chris Hohn bags $124 million from Wirecard’s stocks collapsing.
The Children’s Investment Fund, which employed Sunak as an analyst before he became an MP, short sold 1.53 percent of Wirecard’s shares, according to Bloomberg data.
“It was reported that the auditors could not find €1.9billion of cash that was supposed to be in the business”
THE WEALTH TRAINING COMPANY
Meanwhile, Markus Braun, the former CEO of the German payment services provider Wirecard, has been arrested, public prosecutors in Munich confirmed on Tuesday, saying that he had turned himself in on Monday, June 22.
Chris Hohn bags $124 million from Wirecard’s stock collapsing is a change of future for the UK hedge fund manager.
“Chris Hohn bags $124 million from Wirecard’s stocks collapsing comes at a welcome time for the activist fund manager but it may not be enough to push the fund in the black” – The Wealth Training Company
In April Chris Hohn’s The Children’s Investment Fund suffered losses well north of $3 billion in the recent market volatility driven by the pandemic global lockdowns and the central banks $18 trillion in the global stimulus
The Children’s Investment Fund lost about 19% during the month, the worst since it started in 2004, according to people with knowledge of the matter. The decline pushed the fund’s first-quarter loss to about 23%, according to an undisclosed source from the London-based investment firm, which managed about $30 billion before the March losses.
Chris Hohn’s fund joins a string of activist investors such as Dan Loeb in losing money in April. Loeb’s Third Point Offshore Fund dropped 11% in March, bringing its loss in April to 16%. The S&P 500 Index fell 12.5% in March, its worst monthly performance since October 2008.
Chris Hohn bags $124 million from Wirecard’s stocks collapsing comes at a welcome time for the activist fund manager but it may not be enough to push the fund in the black. Meanwhile, Wirecard is filing for insolvency proceedings.