RHJ International SA has been criticized by a group of hedge funds for what it called as 'erratic' acquisition strategy and its fund payments to managers as 'egregious'. The group also called for an overhaul of the current board of directors as well as the return of capital accumulated to its investors.
A number of the companies acquired by RHJ since its 2005 IPO has either been sold at a loss or has sought bankruptcy protection. This prompted Equilibria Capital Management Ltd to write a letter to RHJ shareholders. According to the letter, Equilibria is working with four other fund managers and it has determined that the company paid its CEO Leonard Fischer about Eur28 million or US$36.6 million since 2007, when its share values fell by as much as 73% and the company posted losses.
The hedge fund manager based out of Geneva said, "The pay practices at RHJI are egregious. particularly in the face of continued losses." It further said, that the compensation is 'further evidence of RHJI's dysfunctional structure and lack of adequate oversight.'
Join the Conversation