U.S. LOOKS INTO WAGERS ON HERBALIFE  | “Three federal agencies and one billionaire hedge fund manager have placed Herbalife under the microscope, scrutinizing whether the diet supplements company is a pyramid scheme,†Ben Protess and Alexandra Stevenson write in DealBook. “But Herbalife is not the only one under investigation. Some federal authorities are pursuing other inquiries that might expand the regulatory gaze from Herbalife to the traders who traffic in the company’s stock.â€
The authorities are said to have concentrated their focus on traders with contrasting views of Herbalife. As one group has wagered that Herbalife was a pyramid scheme â€' William A. Ackman, the billionaire hedge fund manager, has staked a $1 billion bet on that belief â€' other investors expected the company to emerge intact. Neither side has been accused of wrongdoing, but a number of well-timed bets for and against Herbalife caught the attention of the Securities and Exchange Commission and the F.B.I., raising questions about possible insider trading, disclosure violations and market manipulation.
The Securities and Exchange Commission is said to have sent requests for documents to several investors betting on Herbalife’s success, including investment firms founded by Carl C. Icahn and George Soros. The S.E.C. and F.B.I. are also starting to question whether Mr. Ackman’s hedge fund, Pershing Square Capital Management, improperly encouraged other traders to bet against Herbalife. “Together, the investigations have thrust the authorities into the uncomfortable role of picking winners and losers in the billion-dollar game,†Mr. Protess and Ms. Stevenson write.
ASTRAZENECA REJECTS PFIZER’S IMPROVED OFFER  | AstraZeneca of Britain rejected a sweetened offer by its rival Pfizer on Friday, calling the deal in excess of $100 billion “inadequate.†Pfizer had increased its bid by about 7 percent in a new takeover proposal announced early Friday, Chad Bray writes in DealBook. Pfizer said Friday that it was willing to pay a combination of cash and shares equal to 50 pounds a share, or about $84.
Pfizer publicly declared its interest in AstraZeneca earlier this week after making several informal takeover approaches. Pfizer had previously offered a share-and-cash combination worth 46.61 pounds a share, which AstraZeneca’s board determined “very significantly undervalued†the company. AstraZeneca had raised concerns about the structure of the earlier proposal, including the risk in executing a so-called inversion, a move that allows United States companies to reincorporate abroad and escape the high American corporate tax rate.
ARES TO MAKE MARKET DEBUT Â |Â Ares Management, a relatively unknown but rapidly growing private equity and debt investing firm, is expected to debut on the New York Stock Exchange on Friday, becoming the seventh major private equity firm to go public, William Alden writes in DealBook. The initial public offering is said to be priced at $19 a share, below an expected range of $21 to $23. The offering raised $345.7 million for Ares and a large shareholder and valued the company at about $4 billion.
In tapping the public markets, Ares is taking after other private equity firms, including the Blackstone Group, Apollo Global Management, the Carlyle Group and Kohlberg Kravis Roberts, which have used their publicly traded shares to help propel growth. For Ares, which tends to fly under the radar, the I.P.O. is also an opportunity for branding. The firm was established in 1997 before spinning out from Apollo, a buyout and debt specialist to which Ares is often compared.
IT’S JOBS DAY  | Month-to-month gains in hiring have been volatile recently, but most economists expect a fairly strong report on the job market when the Labor Department releases its April figures at 8:30 a.m. The consensus is for employers to have added 210,000 in April, with a decline in the unemployment rate to 6.6 percent. If the actual payroll gain meets or exceeds that estimate, it will be the best month for hiring since November 2013.
But don’t get too caught up in the numbers. “Even when the economy is moving in a clear direction, the statistical noise in month-to-month changes can be big enough to obscure any trend,†Neil Irwin and Kevin Quealy write in The Upshot.
ON THE AGENDA  | In addition to the jobs report, factory orders are out at 10 a.m. Mohamed El-Erian, formerly chief executive and co-chief investment officer of Pimco, is on Bloomberg TV at 9:30 a.m. A happy birthday to Michael L. Corbat, the chief executive of Citigroup, who is turning 54. Berkshire Hathaway’s annual shareholders meeting is on Saturday in Omaha, Neb. Get out your best hats â€' the quest for horse racing’s Triple Crown begins on Saturday with the Kentucky Derby.
K.K.R. SEEKS TO ATTRACT SMALLER INVESTORS  | Only the wealthiest and most sophisticated investors can put money into the leveraged buyouts done by the Kohlberg Kravis Roberts. But that may soon change, DealBook’s William Alden writes. K.K.R. is working with a third-party firm to allow investors to commit a minimum of $10,000 for exposure to its private equity funds. The move would give K.K.R. access to so-called retail investors, who are seen as an untapped source of capital.
The new investment product, subject to approval by the Securities and Exchange Commission, would be the first time K.K.R. had taken smaller investors into its core business. But this is not the first time a private equity firm has tried to gain access to retail investors. One of K.K.R.’s rivals, the Carlyle Group, introduced a product last year that, in partnership with a third-party firm, allowed investors to commit as little as $50,000 for access to Carlyle’s private equity funds.
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Berkshire’s Energy Arm to Buy AltaLink, a Power Transmission Company  | The deal â€' struck on the eve of Berkshire’s annual investor meeting in Omaha, Neb. â€' is the latest takeover struck by the conglomerate’s energy arm.
DealBook »
Merck Said to Be Near Closing Deal With Bayer  | The big health care company, is close to a deal to sell its consumer unit to Bayer for about $14 billion, a person briefed on the matter said on Thursday.
DealBook »
As Netflix Resists, Most Firms Just Try to Befriend Comcast  | “In the middle of an otherwise routine earnings report last week, Netflix took an unexpected detour into the realm of antitrust enforcement: It opposed Comcast’s proposed purchase of Time Warner Cable,†Jonathan Mahler writes in The New York Times. “The statement certainly grabbed the attention of the entertainment and communications industries. What it did not do was rally many others to the fight.â€
NEW YORK TIMES
Game Legend at Center of Oculus Dispute  | The involvement of the technical wizard John Carmack with Oculus VR is prompting accusations from his old employer, ZeniMax Media, that he went too far in helping the company improve its virtual reality technology, the Bits blog writes. ZeniMax Media appears to be stepping up the pressure because of Facebook’s pending agreement to acquire Oculus for $2 billion.
NEW YORK TIMES BITS
R.B.S. Profit Triples on Lower Loan Charges and One-Time Gains  | The Royal Bank of Scotland’s quarterly profit of 1.19 billion pounds, or about $2.01 billion, sent the lender’s shares up by 11.5 percent in morning trading in London.
DealBook »
A Dinner Among Survivors of the Financial Crisis  | At a charity event on Wednesday, the chief of Goldman Sachs was overheard recounting a dinner with Jamie Dimon of JPMorgan Chase and Peter Sands of Standard Chartered, where they traded stories from the dark days of 2008.
DealBook »
Lazard’s Earnings More Than Double on Jump in M.&A. Activity  | The investment bank reported $81 million in first-quarter net income on Thursday, as the firm claimed significant merger advisory assignments.
DealBook »
Energy Future Hearing Draws a Crowd  | Lawyers, advisers and observers packed into three courtrooms for the first hearing in the bankruptcy of Energy Future Holdings, with more than 100 people filling the main courtroom, Bloomberg News writes. The buyout of Energy Future in 2007 defined the money and power of the golden age of private equity.
BLOOMBERG NEWS
Crisis in Ukraine Could Make Infrastructure Deal Making Difficult  | Infrastructure investors are concerned that politicians may diversify Europe’s energy away from Russian gas, pushing up the prices of renewables, shale gas and new pipelines, The Wall Street Journal writes.
WALL STREET JOURNAL
Sony Expects Less as Its Computer Sales Tail Off  | Sony had expected a profit at the beginning of its fiscal year, but its personal computer sales fell after the announcement that it would leave the business, The New York Times writes. Sony’s growing losses add to problems for Kazuo Hirai, the company’s chief executive, who last year rejected a proposal made by the activist investor Daniel S. Loeb to spin off part of Sony’s entertainment units.
NEW YORK TIMES
JPMorgan Trader Joining Och-Ziff  | Jeremy Wien, the head of VIX trading at JPMorgan Chase and a regular participant in the World Series of Poker in Las Vegas, is joining the hedge fund Och-Ziff Capital Management, Bloomberg News reports.
BLOOMBERG NEWS
Searching For Yield, at Almost Any Price  | Investors are desperate for better returns on their investments but are largely having to settle for lesser quality these days, Floyd Norris writes in the High & Low Finance column.
NEW YORK TIMES
Call Operator Atento Files for I.P.O. Â |Â The Spanish call operator Atento, which is owned by the private equity firm Bain Capital, filed with United States regulators to raise up to $300 million in an initial public offering of its ordinary shares, Reuters writes.
REUTERS
Vestar Preparing I.P.O. of National Mentor Holdings  | The private equity firm Vestar Capital Partners is said to be preparing an initial public offering of shares in National Mentor Holdings, which provides health services to adults and children with disabilities, The Wall Street Journal writes, citing unidentified people familiar with the situation.
WALL STREET JOURNAL
Environmentalists Sue Over San Francisco Tech Shuttles  | Activists, union leaders and environmentalists filed a lawsuit on Thursday against the Bay Area’s 20 technology shuttle operators, including Google and Genentech, demanding that the city complete an environmental assessment of the commuter system’s impact, ReCode reports.
RECODE
BookBub Raises $3.8 Million  | A start-up called Pubmark, also known as BookBub, has raised $3.8 million to help publishers and authors sell e-books online, The Wall Street Journal writes. The Series A funding round was led by NextView Ventures and Founder Collective.
WALL STREET JOURNAL
EBay Settles Antitrust Case Over No-Poaching Deal  | The Justice Department accused eBay of having a secret deal with Intuit not to try to hire each other’s employees, The New York Times writes.
NEW YORK TIMES
Call for Limits on Use of Data From Customers  | The White House released a long-anticipated report on Thursday that recommends developing government limits on how private companies make use of the flood of information they gather from their customers online, The New York Times writes. Because the effort goes so far beyond information collected by intelligence agencies, the report was viewed warily in Silicon Valley.
NEW YORK TIMES
Why U.S. Growth Slowed to a Halt at the Start of the Year  | The readings were weaker than expected. Consumers are doing their part to drive the economy, but they’re nearly alone, Neil Irwin writes on The Upshot.
NEW YORK TIMES UPSHOT
S.E.C. Fines NYSE Euronext for Rigging Markets  | The New York Stock Exchange and its affiliates agreed to pay $4.5 million for failing to comply with rules related to co-location services, block trades and net capital requirements, The Financial Times writes.
FINANCIAL TIMES
