Idiot Hedge Funds Lose $5.3 Billion in $VRX Plunge

I’m so done with this story. Valeant is the hedge fund hotel that checks you in, but doesn’t let you out.

The losses via concentration is both mind boggling and staggering.

Overall, Valeant lost over $12 billion in market cap yesterday, of which over $5 billion belonged to idiot hedge less hedge fund managers.

Ackman’s $12 billion Pershing Square Capital Management and Ubben’s $14 billion ValueAct Holdings, which invest for large clients including state pension funds, are two of Valeant’s largest investors with directors on its board.

Ackman’s fund, Valeant’s third largest investor with 16.5 million shares, lost an estimated $776 million on Tuesday while Ubben’s fund, Valeant’s fourth largest shareholder with 14.9 million shares, lost roughly $701 million. The estimates are based on share counts from the end of December.

At least five smaller hedge funds had tied up 20 percent or more of their capital with the company as of the end of December, according to Symmetric.IO, betting that it could turn its fortunes around.

Brave Warrior Advisors has one quarter of its roughly $3 billion invested with Valeant and lost an estimated $292 million on Tuesday, if its position remained unchanged from the end of December.

At Brahman Capital, which also has more than one quarter of its money invested in Valeant, the losses are estimated at $379.5 million on Tuesday alone, if the fund still owns the 8.1 million shares it reported at the end of December.

Okumus Capital, which added Valeant in the fourth quarter, lost an estimated $87 million on Tuesday, if it still owned the stock. Senzar Asset Management, which also added Valeant in the fourth quarter, lost an estimated $60.7 million. Tyrian Investments, a fund that managed $870 million at the end of December 2014 according to a regulatory filing, lost an estimated $8 million on Tuesday with Valeant.