Galleon's troubles already had an impact Monday in Sri Lanka, where Rajaratnam was born and is a citizen--he is also a citizen of the U.S. Many of Galleon's top holdings, including John Keells Holdings PLC (JKH.SL), Commercial Bank of Ceylon PLC (COMB.SL) and National Development Bank (NDB.SL), are traded on the Colombo Stock Exchange in Sri Lanka. That market's benchmark lost as much as 3% early Monday, and ended down 1.6%.
Galleon Investment In India
Galleon Hedge Fund, which currently has assets under management of around $3.7 billion, has a 7.04% stake in broking firm Edelweiss Capital (as of June 2009) and a 4.61% stake in construction company Shriram EPC. The investment in Edelweiss is valued at Rs 275.6 crore, while in Shriram, it’s valued at Rs 38.90 crore. Interestingly, Edelweiss is Galleon’s fourth-largest shareholding after eBay, Apple and Google.
The hedge fund is also said to have major short positions in a leading private sector bank, a steel company, a large telecom player, a CV major and also in bank scrips that are part of the Nifty.
The fund’s other investments in India include that in Pipavav Shipyard (0.3% of equity share capital) and Reliance Telecom Infrastructure (RTIL), both pre-IPO investments. It is, however, not known whether the fund is still invested in RTIL. (http://economictimes.indiatimes.com/News/News-By-Company/Corporate-Trends/Galleon-may-have-little-impact-in-India/articleshow/5140277.cms?curpg=2)
Galleon Group's equity portfolio also holds relatively small positions in many large stocks, but its stakes in some smaller companies could cause ripples in the small- and micro-cap space if the hedge-fund firm is forced to quickly sell shares. So investors are advised to be cautious in above-mentioned stocks as selling pressure in them can be high.
Rajaratnam's lawyer has insisted his client isn't guilty of the charges. But investors in the group's funds could follow the lead of Rochdale Investment Management, which said Monday it was liquidating its stake in the Galleon Diversified fund. If enough investors left Galleon, managers at the firm could be forced to sell shares of companies it owns in order to meet those redemptions. Galleon could also seek to prevent investors from redeeming money immediately.
Rajaratnam's lawyer has insisted his client isn't guilty of the charges. But investors in the group's funds could follow the lead of Rochdale Investment Management, which said Monday it was liquidating its stake in the Galleon Diversified fund. If enough investors left Galleon, managers at the firm could be forced to sell shares of companies it owns in order to meet those redemptions. Galleon could also seek to prevent investors from redeeming money immediately.
Top Galleon Holdings http://in.reuters.com/article/marketsNewsUS/idINN1921261220091019
Galleon Clients Abandon Ship http://online.wsj.com/article/SB125599945778395523.html?mod=WSJ_hpp_sections_business
Hedge fund founder Raj Rajaratnam and executives from some prestigious US cos have been charged with the largest hedge fund insider-trading scheme ever http://www.businessworld.in/bw/2009_10_19_US_Charges_Billionaire_Rajaratnam.html
Raj Rajratnam charged in insider trading case http://prabhakar-views.blogspot.com/2009/10/galleons-rajaratnam-charged-in-biggest.html
