Wall Street Moguls Win Important Backer in Their Fight Over Hedge Fund Sale

A coterie of high-profile buyers, together with Bill Ackman of Pershing Square, Boaz Weinstein of Saba Capital Management and Marc Lasry of Avenue Capital Group, is pushing to purchase Sculptor Capital, the successor to the storied hedge fund Och-Ziff — although the fund has already agreed to promote itself to a different funding agency.

On Thursday, they gained an necessary supporter. The former chief and a serious shareholder of Sculptor, Robert Shafir, informed a particular committee advising Sculptor’s board that he wouldn’t assist the deal the corporate struck in July with the real-estate funding agency Rithm Capital.

That deal would worth the agency’s class A shares at $11.15, round 18 p.c greater than they have been definitely worth the day it was introduced. But shares of the hedge fund have fallen considerably over an extended interval, dropping 60 p.c over the previous two years.

The consortium’s most up-to-date provide for Sculptor, disclosed on Wednesday, would worth it at about $12.76 for every of its class A shares.

Sculptor has rejected the consortium’s bid, arguing it’s much less certain to shut than Rithm’s deal.

Mr. Shafir, who stated he owns 6.2 p.c of Sculptor’s class A inventory, stated in a letter addressed to the particular committee that the consortium bid is “clearly superior.” He added that it’s “not credible to maintain the position that this group does not have the funds and resources to complete this transaction.”

A key flashpoint in any deal would be the way forward for Sculptor’s administration staff, together with its chief govt, James Levin. Mr. Levin had been extensively seen as an inheritor obvious to Daniel Och, Sculptor’s co-founder who stepped down as chief govt in 2018, two years after the corporate agreed to pay a $413 million positive to settle bribery expenses. But Mr. Och threw his assist behind Mr. Shafir, who was appointed chief govt in 2018. Mr. Levin in the end took over the reins in April 2021.

The consortium has proposed changing Mr. Levin.

Mr. Och this month joined the refrain of criticism of Sculptor’s take care of Rithm Capital, writing in a letter to the board’s particular committee that the deal “substantially undervalues” the agency.

Sculptor has stated that Mr. Och’s critiques of the deal “are based upon distortions and misrepresentations.” The agency contends it “ran a robust sales process supported by world-class legal and financial advisers.”

A spokesman for Sculptor didn’t instantly reply to a request for remark.