(Bloomberg) -- It took just $1.14 million worth of well-timed trades to knock down one of Asia’s top hedge funds. Most Read from Bloomberg A Hong Kong court on Wednesday revealed how Simon Sadler’s Segantii Capital Management Ltd.
allegedly used insider information to sell shares of an apparel retailer ahead of an impending block trade seven years ago. The details underscore how accusations of wrongdoing can be devastating for investment firms, even if they involve trades that are tiny relative to assets under management. Segantii, which oversaw $4.
77 billion at the end of April, decided last month to shutter its hedge fund and return all its outside capital to investors, after the initial charges by Hong Kong authorities caused redemption requests to spike. The Segantii case, which is being moved to a higher-level court in the Asian financial hub, is likely to delve into the inner workings of block trades — in which investment banks arrange sales of big chunks of shares off exchanges by connecting sellers with buyers. The next hearing has been scheduled for July 2.
The prosecution’s case mentioned in court on Wednesday centers around a block trade in Esprit Holdings Ltd. In June 2017, a large shareholder of the fashion chain was looking to sell out. The Hong Kong-listed company, which was valued at more than $20 billion more than a decade ago, was well past its heyday after trying to revitalize sales of its name-branded apparel.
Esprit’s market capitalization was a.
