Latin America Venture Capital Fund Raises New $135 Million Fund

SÃO PAULO, Brazil â€" Despite the turbulence currently hitting emerging markets, the venture capital fund Kaszek Ventures, in Buenos Aires, recently raised a new $135 million fund, signaling that the region’s long-term prospects remain promising.

Kaszek’s second fund, which closed last month, eclipsed its first one, $95 million, raised in 2011. The amount also exceeded Kaszek’s goal of $80 million to $100 million set during fund-raising. Backers included several prominent Silicon Valley investors

The firm’s founding partners, Hernán Kazah and Nicolás Szekasy, declined to provide any information about their funds’ investors, citing confidentiality. But others with direct knowledge of Kaszek’s decisions but speaking on condition of anonymity, did identify some of the investors.

According to those people, the new fund’s investors include the investment firms Horsley Bridge Partners and Sequoia Heritage, the fund of funds linked with Sequoia Capital, as well as Kevin Efrusy, the partner at Accel Partners responsible for its early investment in Facebook. All had also invested in Kaszek’s first fund.

Horsley Bridge, in fact, doubled its investment this time around, putting in $20 million.

Mr. Kazah and Mr. Szekasy gained acclaim while at MercadoLibre, a Latin American website similar to eBay. Mr. Kazah co-founded the company with Marcos Galperin in 1999, and Mr. Szekasy shortly thereafter served as chief financial officer. Two years later, Argentina collapsed in the largest sovereign default in history. Yet they persevered and the company went public in 2007. It remains the Nasdaq’s only Internet company from Argentina or Brazil.

That background, said Fred Giuffrida, managing director at Horsley Bridge, appealed to him. Now, he said, he was impressed by how Kaszek has run its debut institutional fund.

It is early to see financial returns in Kaszek’s funds. Only one company in its portfolio has been acquired.

But by one measure, the ability to raise follow-up funding, it has shown promise. Of the 22 companies that Kaszek has invested in, 17 have raised at least one subsequent financing round, and 11 of those brought in new investors.

“They have a very high hit rate in terms of companies getting follow-on funding,” said Keith Johnson, chief investment officer of Sequoia Heritage, which, he said, invested in both Kaszek funds. He said it was the only early-stage venture capital firm in the region in which he had invested.

Kaszek’s co-founders have said that it will continue to focus on Brazil â€" roughly two-thirds of its companies it has invested in are based there â€" despite the country’s sluggish economy.

For Horsley Bridge, the troubled economy has meant that there is less competition among investors and more talent available for companies to hire.

Not all the economic trends are worrisome. Internet use continues to grow and there has been a boom in new companies.

“Now, it is a better time to invest than when people were looking into this a couple of years ago,” Mr. Giuffrida said.

Coke and Einhorn Take Opposite Sides of Green Mountain Bet

Betraying its renowned jingle, Coca-Cola is singing in perfect disharmony with David Einhorn. To feel good paying nearly $1.3 billion for a minority stake in Green Mountain Coffee, the beverage giant must have answered some nagging questions posed by the hedge fund manager a few years ago. Investors seem to figure that Coke did its due diligence. Procter & Gamble and Hewlett-Packard have shown just how much that can matter.

For now, the many skeptics, including Mr. Einhorn’s Greenlight Capital, are getting burned. As of mid-January, a quarter of Green Mountain’s outstanding shares were being shorted, or roughly 14 days of average trading volume. As recently as October, Mr. Einhorn said he had been adding to his bet against the company. After Green Mountain, the maker of single-cup brewing systems, disclosed this week that Coke would invest and help it introduce a new cold drink machine, Green Mountain shares jumped more than 30 percent.

Mr. Einhorn, who rocketed to fame after presciently and publicly challenging management at Lehman Brothers, can’t be dismissed lightly. In fact, Green Mountain’s shares tumbled more than 80 percent in the months after he first raised questions about the company’s accounting practices and growth potential in October 2011. While they have recovered most of that value, there are lingering concerns. For one thing, the Securities and Exchange Commission is still investigating Green Mountain’s accounts and its relationships with distributors.

The blue chip endorsement may have helped allay some concerns. There must be some presumption that Coke gave its new partner in caffeine a comprehensive review before taking such a big step. Green Mountain’s boss, Brian Kelley, a former Coca-Cola executive, didn’t provide much detail but said the deal was subject to “thorough discussion with significant diligence on both sides.”

Even so, recent history should leave at least a shadow of doubt. Not long after sealing a $12 billion deal for the software maker Autonomy in 2011, HP took a charge of almost $9 billion, in part because of what it called dodgy bookkeeping at the target. And Procter & Gamble’s initial plan to sell Pringles the same year collapsed when an accounting scandal enveloped its intended partner, Diamond Foods. The imprimatur of a careful and calculated company like Coca-Cola is sweet, but investors would do well to keep their perspective.

Kevin Allison is a columnist at Reuters Breakingviews. For more independent commentary and analysis, visit breakingviews.com.

Morgan Stanley Adds 4 Executives to Operating Committee

Morgan Stanley has named four executives to its operating committee, the bank’s most senior group of managers.

The bank has added Michael Heaney and Robert Rooney, who run the firm’s fixed income unit; Shelley O’Connor, who runs the private investment bank; and Andy Saperstein, who heads the investment products and services division. The move brings Morgan Stanley’s total operating committee to 16 members, a spokesman for Morgan Stanley said.

James P. Gorman, the bank’s chief executive, announced the appointments in an internal email Friday afternoon.

“These appointments reflect the importance to the firm of the businesses these individuals run and the leadership role each plays in driving our firm strategy and our future success,” Mr. Gorman said in the message.

Morgan Stanley does not often appoint new members to its operating committee, which is made up of the top echelon of the firm’s leadership. The committee currently includes Mr. Gorman, Greg Fleming, the president of the firm’s wealth management and investment management operations, and Ruth Porat, the chief financial officer.

Each member receives a base salary of at least $1 million and are not allow to sell 75 percent of the stock awards they earn while they serve on the committee, according to a proxy filing.

News of the appointments was first reported by Bloomberg.

Moody’s Joins S.&P. in Cutting Puerto Rico to Junk

Moody’s Investors Service downgraded Puerto Rico’s general-obligation debt to junk status on Friday, compounding the commonwealth’s difficulties as it seeks fresh sources of cash.

It was Puerto Rico’s second downgrade to junk this week after Standard & Poor’s took the same step on Tuesday. Puerto Rico has a number of financial commitments outstanding that require it to make substantial cash payments if two of the three main ratings agencies cut its credit to junk.

The island’s debt problems can have an outsized effect on the rest of the United States because its bonds are unusually widely held by both institutional and individual investors. Its debt is popular because it pays tax-exempt interest in all 50 states, thanks to Puerto Rico’s legal status. Many investors hold the debt without knowing it because tax-exempt mutual funds often include it in their portfolios.

Moody’s said many years of deficit spending and underfunding of public pensions had taken a heavy toll on Puerto Rico, leaving it with a high debt burden and scarce available cash.

“In our view, the commonwealth’s credit profile is no longer consistent with investment-grade characteristics,” the ratings service said in announcing it had cut Puerto Rico’s rating to Ba2 from Baa3, or two notches. It said that it was keeping a negative outlook, indicating that more downgrades were possible.

Moody’s acknowledged steps the Puerto Rican government had taken to strengthen its finances, like cutting back on pensions for government workers, reining in government spending, issuing less debt and promoting economic development.

“While some economic indicators point to a preliminary stabilization, we do not see evidence of economic growth sufficient to reverse the commonwealth’s negative financial trends,” it said.

Moody’s also downgraded the outstanding debt issued by the island’s independent borrowing authority, known as Cofina, although the new ratings were still in the investment-grade range. Officials in Puerto Rico had hoped to expand the Cofina’s borrowing capacity, so that it could bring new bonds to market in the next few weeks.

Weekend Reading: Sochi Olympics vs. Wall St.

If you prefer CNBC to NBC Sports, check out DealBook’s alternative programming guide to the Winter Olympics.

Olympic Sport Why Watch Wall St. Event Why Watch Edge

Alpine Skiing	Horrific crashes.	Bankruptcy	Horrific collapses.	Olympics
Biathlon	Combines random sport with big guns.	Activist Investors	Combines random industry with big egos.	Wall St.
Bobsleigh	Jamaican sledders overachieving.	Currency Trading	German bankers under investigation.	Olympics
Cross Country Skiing	Downhill skiing too exciting.	Emerging Markets	Rising interest rates too unnerving.	Wall St.
Curling	Irony? The glory of the Olympic spirit.	I.P.O.	The glory of lead left.	Wall St.
Figure Skating	Triple Salchow, politics, costumes.	N.Y.C. to D.C. Revolving Door	360 degree spins, politics, hypocrisy.	Olympics
Ice Hockey	Dreams of reliving 1980 glory.	Internships	Dreams of Silicon Valley call backs.	Olympics
Luge	Rapid slides.	Twitter Stock	Same reason.	Olympics
Nordic Combined	The excitement of jumping and monotony of not jumping.	Mergers	The thrill of advisory fees and threat of downsizing.	Wall St.
Short Track Speed Skating	Winner decided by hundredths of a second.	High-frequency trading	Winners decided by milliseconds.	Wall St.
Skeleton	Sounds awesome. Helmets look cool.	Shadow Banking	Regulators aren’t watching, why should you?	Olympics
Ski Jumping	“Vaulting through air seems safe, right?”	Mortgage Settlements	“No money down on your second home!”	Olympics
Snowboard	Young rich kids mocking death.	Insider Trading	Older rich kids mocking Preet Bharara.	Wall St.
Speed skating	Racing, jostling, Spandex.	Quarterly Earnings	Sexy allure of EBITDA.	Olympics
		Final Score	Olympics 8, Wall St. 6

A look back on our reporting of the past week’s highs and lows in finance.

FRIDAY

Moody’s Joins S.&P. in Cutting Puerto Rico to Junk | Moody’s Investors Service downgraded Puerto Rico’s general-obligation debt to junk status on Friday, compounding the commonwealth’s difficulties as it seeks fresh sources of cash. DealBook »

THURSDAY

Ex-SAC Trader Convicted of Securities Fraud | With the conviction of Mr. Martoma, the nearly decade-long investigation of Steven Cohen and his hedge fund may have seen its last criminal prosecution. DealBook »

Common Sense: Past Fictions, a Lack of Trust and No Deal | Mathew Martoma seemed to be able to cut a deal with prosecutors, but his handling of a years-old episode involving fabrication of documents casts doubt on his trustworthiness, writes James B. Stewart. DealBook »

Legal Troubles Barely Subdue a Bitcoin Evangelist’s Sermons | Charles Shrem, the Bitcoin enthusiast, says he hopes one day to return to the world of the virtual currency, maybe as its chief aficionado. DealBook »

State Regulator Halts Deal Between Wells Fargo and Loan Servicer | The office of Benjamin Lawsky, the superintendent of New York’s Department of Financial Services, has halted the transfer of about $39 billion in servicing rights to Ocwen from Wells Fargo. DealBook »

Legal Costs Hurt Credit Suisse Profit | The Swiss bank’s net income increased about 2 percent, after it set aside money to cover costs for mortgage litigation and a tax dispute with the United States. DealBook »

WEDNESDAY

Investors Appear to Shrug Off Puerto Rico’s Debt Downgrade | There was no mass selling of Puerto Rico bonds a day after the island’s credit rating was cut. DealBook »

Lazard’s Profit Rises 35%, Aided by Asset Management | Lazard said it benefited from improvements in its advisory and asset management businesses in the fourth quarter, adding that it expected deal activity to improve this year. DealBook »

New York Investigates Currency Trading | The inquiry by the state’s Department of Financial Services into potential manipulation of the market comes in the face of departures and firings of foreign currency traders at major banks. DealBook »

Coca-Cola to Buy Stake in Coffee Company | Coke will buy about 16.7 million shares in Green Mountain for about $1.25 billion. In return, Green Mountain will be the official maker of the soda giant’s forthcoming single-serve cold beverages, built on its popular Keurig pod-based system. DealBook »

The Trade: Maintaining Ethics in Moving From Regulator to Regulated | Life is fraught for financial watchdogs who switch to the private sector, especially if they try to have standards, writes Jesse Eisinger. DealBook »

TUESDAY

S.&P. Cuts Puerto Rico’s Debt to Junk | The move intensified a cash squeeze for the commonwealth, whose financial condition is of outsize importance to the rest of the United States because its debt is widely held by individual investors through mutual funds. DealBook »

Morgan Stanley Reaches $1.25 Billion Settlement | The Morgan Stanley settlement is the latest agreement between a Wall Street firm and the Federal Housing Finance Agency, which has sued several banks and financial institutions seeking relief over losses that were borne by taxpayers. DealBook »

Revamping and Tax Gain Help UBS Beat Estimates | Net profit for the fourth quarter was 917 million Swiss francs, or $1 billion, compared with a loss of 1.9 billion francs in the period a year earlier. DealBook »

Deal Professor: In Yearlong Clash Over Herbalife, Innuendo Trumps Clarity | Without clear information on Herbalife’s business model, the speculation in its stock creates extreme volatility as investors trade on rumor, writes Steven M. Davidoff. DealBook »

MONDAY

As Recovery Looks Weak, Stocks Take a Deep Dive | Poor numbers on factory orders and car sales left investors wondering if their view of the economy was too rosy, and the three major indexes each fell more than 2 percent. DealBook »

Detroit Turns Bankruptcy Into Challenge of Banks | Financial institutions that helped raise money for Detroit’s pension system are dismayed now to see themselves portrayed as shady characters in the city’s lawsuit. DealBook »

DealBook Column: Too Many Sorry Excuses for Apology | Andrew Ross Sorkin writes that the art of the apology has become a choreographed dance: Say you’re sorry, act vulnerable, tell everyone you’re “taking responsibility” and end with “I hope to put this behind me.” DealBook »

Closing Arguments in Martoma Trial | DealBook »

Hewlett-Packard Discloses Accounting Errors at Company It Bought | Hewlett-Packard took an $8.8 billion charge in 2012, claiming discrepancies in Autonomy’s numbers. Now it has fleshed out those restatements. Autonomy continued to deny any impropriety. DealBook »

Hedge Fund Chief Makes a Lonely Bet Against Portugal’s Debt | David Salanic, the chief executive of the hedge fund Tortus Capital, says he believed that Portugal would soon default on its private sector bonds â€" in the same way Greece did in 2012. DealBook »

SUNDAY

After Scandal, SAC Capital Begins to Fade to Black | Steven A. Cohen’s hedge fund is completing plans to change its corporate structure by mid-March, according to people briefed on the matter, an effort that comes after SAC pleaded guilty to insider trading. DealBook »

Unlikely Allies Seek to Check Power of Activist Hedge Funds | The Shareholder-Director Exchange seeks to provide board members and institutional investors with a protocol to follow when either side wants to talk with the other. DealBook »

Jos. A. Bank in Talks to Buy Eddie Bauer | On Sunday, Jos. A. Bank publicly released a letter to Men’s Wearhouse accusing its bigger rival of failing to properly disclose the antitrust risks in its takeover bid. DealBook »

SATURDAY

Law Doesn’t End Revolving Door On Capitol Hill | Former officials have little trouble passing through loopholes in laws intended to keep them from immediately lobbying their onetime colleagues. DealBook »

WEEK IN VERSE

We’re still holding out hope that Pussy Riot will perform at the Winter Olympics in Sochi, Russia. Until then, enjoy this look back at the 1996 Olympic Games in Atlanta.

“Georgia On My Mind” | Gladys Knight opened the games with poetic pandering to the hometown crowd in Atlanta. YouTube »

“Imagine” | Following a deadly bombing, Stevie Wonder closed the games with John Lennon’s call for peace. YouTube »

GoPro to Go Public

GoPro, the videocamera maker favored by extreme athletes and everyday adventurers, said on Friday that it planned to go public.

Based in San Mateo, Calif., GoPro is one of a number of technology companies that are expected to test the public markets this year, following a string of successful offerings from Silicon Valley companies. And GoPro becomes the latest company to file for a “secret” I.P.O., joining the ranks cloud storage company Box, which began the process last month, and Twitter, which also filed for a confidential I.P.O., allowing the company to keep much of its operating information out of the public eye until shortly before shares begin to trade.

GoPro announced its plans in a brief statement:

SAN MATEO, Calif., Feb. 7, 2014 /PRNewswire/ â€" GoPro, Inc. announced today that it plans to conduct a registered initial public offering of its common stock. The offering is expected to commence after the SEC completes the review process initiated by GoPro’s confidential submission on Friday February 7, 2014 of its draft registration statement.

This announcement is being made pursuant to and in accordance with Rule 135 under the Securities Act of 1933. As required by Rule 135, this press release does not constitute an offer to sell or the solicitation of an offer to buy securities, and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of that jurisdiction.

A JPMorgan Executive Is Said to Decline a Regulatory Advisory Post

Blythe Masters, the head of the commodities business at JPMorgan Chase, has declined an invitation to join an advisory committee of the agency that regulates futures and swaps trading, people briefed on the matter said on Friday.

Ms. Masters had been invited to join the advisory committee by Mark Wetjen, the acting chairman of the Commodity Futures Trading Commission. Her name was even added to a list of members on the website for the committee, which advises the agency on global markets and whose members include policy advocates, an academic and a number of financial industry professionals.

JPMorgan is finalizing a sale of its physical commodity business, creating a workload for Ms. Masters that “would make it tough for her to participate” in the markets advisory committee, a person briefed on the matter said. The bank has offered to make another one of its officials available to the regulator, this person said.

Ms. Masters, a powerful Wall Street executive known as a pioneer in the use of credit derivatives, came under regulatory scrutiny last year as the nation’s top energy regulator, the Federal Energy Regulatory Commission, accused the bank of manipulating energy markets in California.

The agency’s investigators claimed that Ms. Masters made “false and misleading statements” under oath, an accusation that JPMorgan disputed. The bank struck a $410 million settlement with the regulator in July, neither admitting nor denying the accusations of market manipulation.

The Commodity Futures Trading Commission has five advisory committees, including one on technology and one on agriculture, that meet several times a year.

Now, the Sentencing for Martoma

The impressive streak of 79 insider trading convictions won by the United States attorney’s office in Manhattan now includes Mathew Martoma, who dealt directly with the hedge fund titan Steven A. Cohen. But the verdict is unlikely to bring prosecutors any closer to what is apparently their aim: to bring criminal charges against Mr. Cohen.

Mr. Martoma was convicted of conspiracy and two counts of securities fraud for using inside information about a failed Alzheimer’s drug trial as a basis for selling shares of Elan and Wyeth, two companies developing the drug. SAC Capital Advisors, Mr. Cohen’s hedge fund firm where Mr. Martoma was a portfolio manager, avoided losses and reaped profits of about $275 million in 2008 by selling large positions in the two companies and then shorting the shares.

The focal point of the government’s case was a 20-minute telephone call from Mr. Martoma to Mr. Cohen shortly after receiving information from a University of Michigan doctor involved in the drug trial, Sidney Gilman, a crucial government witness. Mr. Cohen, who was not accused of wrongdoing in this case, ordered the sale of shares in Elan and Wyeth the morning after the call.

This was as close as the government has been to connecting Mr. Cohen to the insider trading at his firm. Although the investigation continues, Mr. Martoma’s refusal to cooperate meant that prosecutors did not have enough evidence to establish that Mr. Cohen knew he was trading on confidential information, a prerequisite to proving a case against him.

Judge Paul G. Gardephe of the United States District Court in Manhattan has not yet set a sentencing date, but it is likely to take place in the next four to six months. The potential punishment that Mr. Martoma faces is significant, and there is a good chance he will receive a sentence of as much as 10 years.

The federal sentencing guidelines recommend about 15 to 20 years in prison, if calculated on the gains SAC reaped from the trading. If that guideline is followed, it would be the highest sentence ever given for insider trading, exceeding the 12-year prison term for Matthew Kluger in 2012 for tipping information from his law firm that generated about $35 million in profits.

It is Judge Gardephe who will decide Mr. Martoma’s prison term, and he has not demonstrated a pattern in previous white-collar cases. A statement he made in a 2010 sentencing in an insider trading case is something the Justice Department is likely to point to in seeking a significant prison term.

In that case, the defendant sought probation. But Judge Gardephe instead imposed a three-month sentence, stating: “Given the enormous financial awards as a result of this kind fraud and the difficulties of detecting it, it is my belief that a term of imprisonment is often appropriate in this type of case to serve certain objectives and general deterrence and respect for the law.”

Yet the judge does not always follow the government’s recommendation when prosecutors seek a significant penalty involving a white-collar defendant. When he sentenced a former Tiffany executive for stealing $1.2 million in jewelry from the company’s flagship Fifth Avenue store, Judge Gardephe rejected the prosecution’s request for a prison term of 37 to 46 months as provided in the sentencing guidelines. Instead, he sentenced her to 12 months and a day â€" less than one-third of what the government sought.

Prosecutors are likely to seek the maximum sentence for Mr. Martoma, and will point to a record of dishonesty that predates his time with SAC.

Mr. Martoma was kicked out of Harvard Law School for creating a doctored transcript in seeking a judicial clerkship and then trying to cover it up. It’s not clear whether he disclosed that information to Stanford University when he later applied to its M.B.A. program. Although the government was not allowed to use the Harvard expulsion at trial, it can be considered in evaluating Mr. Martoma’s character as part of the sentencing process.

Even if the Judge Gardephe does not follow the sentencing guidelines recommendation, there is a good chance he will not deviate significantly from it because of the huge amount of money involved in the case. The $275 million in trading gains and losses avoided dwarfs the amounts seen in other insider trading prosecutions that resulted in long prison terms. Raj Rajaratnam received an 11-year prison term for gains of over $60 million, and Zvi Goffer is serving 10 years for being the focal point of an insider trading ring that generated $10 million in profits.

One way defendants can try to mitigate the punishment is by cooperating with the government. But for Mr. Martoma, the possibility that prosecutors will be willing to make a deal for a lighter sentencing recommendation in exchange for testifying against his old boss is highly unlikely now that he has been convicted.

Even if Mr. Martoma wanted to testify, the circumstances of his dismissal from Harvard would undermine any claim that he is a credible witness after a sudden change of heart. As James B. Stewart pointed out about the possibility of making a deal with prosecutors, “But would anyone believe him?”

In addition, DealBook reported that Richard Strassberg, Mr. Martoma’s lead defense counsel, said: “We’re very disappointed and we plan to appeal.” That indicates he has no interest in cooperating because that would end any chance of fighting the conviction.

Perhaps the most perplexing question in the case is why Mr. Martoma went to trial rather than making a deal with prosecutors early on. It came out at the trial that an F.B.I. agent had told Dr. Gilman that he and Mr. Martoma were “just a grain of sand” while the real target was Mr. Cohen, so prosecutors would have been quite receptive to what he might have to say.

But there is also the possibility that Mr. Martoma lied to Mr. Cohen by telling him that he obtained the information about the drug trial through proper channels. Or Mr. Martoma didn’t say anything â€" nor did Mr. Cohen ask â€" about whether the information about the failed drug trial was confidential. Except for Mr. Martoma’s word, there doesn’t seem to be a way to prove that Mr. Cohen knowingly traded on inside information as required for an insider trading case.

So it is likely that Mr. Martoma alone will suffer the consequences of receiving confidential information that led SAC to avoid millions of dollars of losses on its investments in Elan and Wyeth. And there is even a chance that Judge Gardephe could accept a recommendation for a punishment that would be the highest ever seen for insider trading.

Apollo Profit Fell 36% in Fourth Quarter

Apollo Global Management was a big seller of its holdings last year, but that wasn’t enough to lift the private equity giant’s profit for the final three months of 2013.

Apollo said on Friday that its profit in the fourth quarter, reported as economic net income after taxes, which includes unrealized gains from investments, fell 36 percent to $421.7 million. That translated to a profit of $1.06 a share, beating the average analyst expectation of 82 cents a share, as compiled by Thomson Reuters.

The decline was largely because of a lower level of carried interest income, the profit that Apollo gets from its investments. The firm said its total carried interest income was $526.8 million in the fourth quarter, 45 percent lower than the period a year earlier.

In explaining this decline, Apollo said that the previous year’s fourth quarter had benefited from a “catch up” of investment profit that was triggered when one of the firm’s big private equity funds reached a minimum threshold for investment performance. The fourth quarter of 2013, however, included no such benefit.

For the full year, Apollo reported a 28 percent increase in economic net income after taxes, to $1.9 billion.

According to generally accepted accounting principles, Apollo reported a 7 percent decline in fourth-quarter profit, to $159.2 million. By that metric, Apollo’s annual profit more than doubled to $659.4 million.

“Our results for the fourth quarter of 2013 completed an exceptional year for Apollo,” Leon D. Black, the firm’s chairman and chief executive, said in a statement. “As we look to 2014 and beyond, we believe Apollo’s integrated global investment platform leaves us well positioned to continue to deliver strong returns to our investors.”

Mr. Black set the tone for last year when he declared in April that the firm was “selling everything that’s not nailed down.” Indeed, with markets buoyant, many private equity firms moved to sell their holdings in 2013, reaping big gains.

Apollo was among the most active in selling its investments. The firm sold CKE Restaurants, the parent of Carl’s Jr., to the Roark Capital Group, and it sold stock in the grocery store chain Sprouts Farmers Market and the chemical maker LyondellBasell Industries.

As it returned money to investors, Apollo also raised a fresh $18.4 billion buyout fund, the largest in its history. Over all, the firm’s assets under management rose 42 percent to $161.2 billion as of Dec. 31, with the closing of a major acquisition adding $44 billion of those assets.

And yet, Apollo’s private equity business was not as profitable as in the past. The private equity funds appreciated by 9 percent in the fourth quarter, but carried interest â€" a crucial source of profit â€" was somewhat lacking compared with the prior year.

Apollo’s total carried interest income from private equity, including realized and unrealized gains, fell by 49 percent in the quarter to $445.4 million.

Like many other firms, Apollo requires that its private equity funds meet a minimum threshold for investment performance before the firm can collect profit. The sixth private equity fund, a $10 billion war chest, crossed that threshold in the fourth quarter of 2012, giving Apollo an immediate surge of profit that was not duplicated in the recent quarter.

Other business segments performed better in the fourth quarter. Apollo’s credit business reported a 65 percent increase in economic net income to $160.1 million in the quarter, while its real estate business showed a $3.9 million profit, compared with a loss of $1.8 million a year earlier.

Apollo announced a fourth-quarter dividend of $1.08 per Class A share, bringing its dividends to $3.98 per Class A share for the full year.

A Guilty Verdict for Former SAC Trader

FORMER SAC TRADER CONVICTED OF INSIDER TRADING  |  A federal jury in Manhattan found Mathew Martoma guilty on Thursday of insider trading , culminating a case that prosecutors had never thought would go to trial in the first place. The case may be the last criminal case to emerge from a decade-long investigation of Steven A. Cohen and his SAC Capital Advisors hedge fund, Alexandra Stevenson and Matthew Goldstein write in DealBook. Mr. Martoma, who is married and has three young children, is expected to face a prison sentence of seven to 10 years.

Mr. Martoma is the 79th person â€" and the eighth person who once worked for Mr. Cohen â€" to either be convicted at trial or plead guilty to insider trading since the current crackdown on insider trading in the hedge fund industry began in 2009. With this latest conviction, the United States attorney’s office in Manhattan extends an unbroken string of successes in prosecuting such cases.

Mr. Martoma’s case was notable because it was the first time that Mr. Cohen was linked to questionable trades at his firm. Throughout the course of the trial, prosecutors proved that Mr. Martoma was guilty of seeking out confidential information related to a clinical trial for an experimental Alzheimer’s drug. The inside information, largely provided by an aging doctor familiar with the results of the clinical trial who was the government’s star witness, helped SAC avoid losses and generate profits totaling $275 million in July 2008.

PAST FICTIONS, LACK OF TRUST AND NO DEAL  |  After F.B.I. agents confronted Mathew Martoma in November 2011 at his home in Boca Raton, Fla., prosecutors spent the next years raising the possibility that Mr. Martoma could strike a cooperation deal. The insistence of Mr. Martoma’s lawyers that he would not make a potentially favorable deal for himself baffled many, especially as the case headed to trial. And now, with Mr. Martoma facing years in prison away from his family, the case’s fundamental mystery has only deepened, James B. Stewart writes in the Common Sense column.

The answer may lie in a confidential report from Mr. Martoma’s disciplinary hearing at Harvard Law School after the discovery that he had altered his transcript to improve his grades in his quest for a judicial clerkship. “How Mr. Martoma handled the Harvard affair, detailed in the confidential report by the law school’s administrative board after what appeared to have been lengthy proceedings, may well have proved devastating to his credibility, and thus to his ability to cut a favorable deal,” Mr. Stewart writes.

THE RISE AND FALL OF A BITCOIN LEADER  |  When Charles Shrem was arrested and charged last month with conspiring to launder money by helping people who wanted to buy drugs exchange dollars into Bitcoin, it seemed as if the Bitcoin world had lost one of its most charismatic, if not most powerful, leaders. Indeed, this was the man who went through millions of dollars’ worth of Bitcoin over the years. But Mr. Shrem’s Bitcoin vision has collided with the real world, and now his own future is uncertain, Nathaniel Popper writes in DealBook.

And yet, in an interview on Thursday, Mr. Shrem’s exuberance was still on display. “Given the opportunity, I will get back on the speaking circuit and be an evangelizer for Bitcoin,” he said in the interview. “At the same time, the more high-profile you are, the more careful you have to be. It’s scary.”

Mr. Popper writes on Mr. Shrem: “His recent reversal of fortune â€" and the meteoric ascent that led up to it â€" makes him a living symbol of the peaks and valleys that have so far defined the Bitcoin experience.”

ON THE AGENDA  |  The big one: January’s jobs report is out at 8:30 a.m. The debt ceiling deadline is today. Alan Greenspan, the former Federal Reserve chairman, is on CNBC at 7:30 a.m. Natalie Massenet, the founder of the online luxury retailer Net-a-Porter, is on Bloomberg TV at 4 p.m. The 2014 Winter Olympics opening ceremony is on NBC at 7:30 p.m.

HERE WE GO AGAIN  |  On Friday, the United States Treasury loses its authority to issue bonds, setting off the fourth debt ceiling fight in three years. “This is the dying gasp of a dead-end strategy,” Representative Peter Welch, a Vermont Democrat, said in an article in The New York Times. “I think this fight is over.”

APPLE BUYS $14 BILLION OF ITS OWN STOCK  |  In the two weeks since Apple reported disappointing fourth-quarter results, the company has repurchased an unprecedented $14 billion of its own stock. Tim Cook, Apple’s chief executive said he was “surprised” by Apple’s decline in share price and wanted to be “aggressive” and “opportunistic,” The Wall Street Journal reports. “It means that we are betting on Apple. It means that we are really confident on what we are doing and what we plan to do,” Mr. Cook said.

Apple’s buyback coincides with calls by Carl C. Icahn, who owns about $4 billion in Apple shares, for the company to use its stockpile of cash to buy back shares. In a bit of a tease, Mr. Cook also said that, while Apple has not made big acquisitions in the past, history doesn’t preclude his company from making a large deal “for the right fit that’s in the best interest of Apple in the long term.”

ICAHN 2.0  |  In the 1980s, Carl C. Icahn was known as a “vulture capitalist” who got rich during the leveraged buyout boom. Now, he’s called an “activist investor,” but his tactics can be traced to his past. And today, says one trader, “A lot of times, even when he gets nothing he asks for, he wins.”

IF YOU CARE ABOUT SPORTS  |  Kevin Durant knows all about being No. 2. He was selected second in the N.B.A. draft in 2007, was second in the M.V.P. voting three times and led his team, the Oklahoma City Thunder, to a second-place league finish in 2012. He was also the No. 2 shoe salesman last year.

AND ABOUT THAT VENTURE CAPITALIST WHO THOUGHT HE COULD BE AN OLYMPIAN  |  Paul Bragiel, the venture capitalist, may have tried, and failed, to qualify for the 2014 Winter Olympics by joining the Colombian cross-country ski team, but he is still making his presence known in Sochi, Russia. On Friday, he plans to release an Olympic-themed mobile game called Team Paul Skiing.

Mergers & Acquisitions »

Illinois Tool Works Sells Packaging Unit to Carlyle Group  |  The Carlyle Group is paying $3.2 billion for the unit, which produces a range of products used in shipping and transportation.
DealBook »

Green Mountain’s Deal With Coke Fails to Dent SodaStream  |  Analysts and investors think that a deal between Coke and Green Mountain may presage another one: some sort of tie-up between SodaStream and Coke’s archrival, PepsiCo.
DealBook »

Vodafone’s Investment Case Will Involve Deal-Making  |  Vodafone will be probably be interested in deals that will give it fixed-line networks in places where it cannot build or rent others on favorable terms, writes Quentin Webb of Reuters Breakingviews.
DealBook »

Amazon Acquires Video Gaming Studio  |  Amazon has purchased the video gaming studio Double Helix Games, TechCrunch reports. The acquisition announcement had been planned for later this month, but news of the deal was leaked in an invitation to a joint recruiting event from Amazon and Double Helix Games. The financial terms of the deal have not been disclosed.
TECHCRUNCH

I.B.M. Considers Sale of Chip Manufacturing Operations  |  I.B.M. is looking to sell its semiconductor manufacturing operations, The Wall Street Journal reports, citing an unidentified person.
WALL STREET JOURNAL

Jos. A. Bank’s Resistance to Merger Wears Down Traders  |  Jos. A. Bank’s stock price has fallen 7 percent below the bid by Men’s Wearhouse of $57.50 a share, which could indicate that investors do not expect the companies to agree on a deal, Bloomberg News reports.
BLOOMBERG NEWS

INVESTMENT BANKING »

Senator Warren Questions Dimon’s Pay Raise  |  Senator Elizabeth Warren called out regulators at a Senate banking committee hearing on Thursday, questioning the effectiveness of regulatory enforcement given the hefty 2013 bonus that Jamie Dimon, JPMorgan Chase’s chairman and chief executive, received, The Financial Times writes.
FINANCIAL TIMES

Swiss Firm Mercuria in Talks to Buy JPMorgan’s Commodities Unit  |  JPMorgan Chase has been exploring strategic alternatives, including a possible sale or spinoff, for the business, which deals in physical commodities like metals and oil.
DealBook »

Barclays Names Junior Trader as Chief of Foreign Exchange Desk  |  Barclays has appointed Daniel Ryan, a junior trader, as the interim chief of the bank’s London spot foreign exchange desk, The Financial Times writes. The move underscores the thinning out of ranks at the bank because of a global inquiry into allegations of currency market manipulation.
FINANCIAL TIMES

PRIVATE EQUITY »

Sony Turns to Investment Firm With a Taste for Unloved Assets  |  Japan Industrial Partners, a little-known Japanese private equity firm that specializes in scouting the electronics landscape for turnaround opportunities, said it would buy Sony’s unprofitable personal computer unit.
DealBook »

K.K.R. Profit More Than Doubled in Fourth Quarter  |  Rising markets helped the private equity firm Kohlberg Kravis Roberts reap big gains from its investments.
DealBook »

Italian Banks Discuss Fund for Bad Loans With K.K.R.  |  Intesa Sanpaolo and UniCredit, Italy’s two top banks, are discussing setting up a bad loans vehicle with the private equity firm Kohlberg Kravis Roberts & Company, Reuters writes, citing unidentified people. The vehicle would help the Italian banks take troubled assets off of their balance sheets.
REUTERS

AEA Considering Purchase of Gypsum Management and Supply  |  The private equity firm AEA Investors is nearing a deal valued at over $700 million to buy Gypsum Management and Supply, a company that makes specialty building materials like drywall, Reuters reports, citing unidentified people familiar with the situation.
REUTERS

HEDGE FUNDS »

Hedge Funds Bet on U.S. Gas Shortage  |  Hedge funds are betting that the United States will face a natural gas shortage before the spring because of the below-average temperatures that have been sweeping the country this winter, The Financial Times writes.
FINANCIAL TIMES

Traders Overhauling Foreign Exchange Positions  |  Hedge fund traders are shuffling their currency holdings after turmoil in the emerging markets that led to the roughest start to the year for currency funds since 2004, Bloomberg News reports.
BLOOMBERG NEWS

I.P.O./OFFERINGS »

Glassdoor, a Jobs Website, Hires a Finance Chief  |  Glassdoor announced that it has hired Adam C. Spiegel as chief financial officer, potentially setting up an initial public offering of the company down the line.
DealBook »

Chinese Drug Company Plans $750 Million I.P.O.  |  Luye Pharma Group, a drug company controlled by Chinese private equity firms, is aiming to raise about $750 million in an initial public offering in Hong Kong, The Wall Street Journal reports.
WALL STREET JOURNAL

Sanborns I.P.O. Proves Too Expensive  |  One year after Grupo Sanborns, a large chain of restaurants and retail stores, filed for an initial public offering, many investors think the the I.P.O. was too expensive, Bloomberg News writes.
BLOOMBERG NEWS

VENTURE CAPITAL »

Venture Capital’s Woman Problem  |  Only 4 percent of senior venture capitalists are women, Fortune reports.
FORTUNE

Vungle Raises $17 million  |  Vungle, a start-up that sells video ads that run within mobile applications, said it had collected $17 million in Series B funding led by Thomvest Ventures, ReCode reports.
RECODE

Truecaller Receives $19 Million in Funding  |  Truecaller, a Swedish company that makes a phone number identification application, said on Thursday that it had raised $19 million from venture capital firms led by Sequoia Capital, The Wall Street Journal reports.
WALL STREET JOURNAL

Technology Companies May Be Overvalued  |  The precipitous drop in Twitter’s share price on Thursday, along with similar declines for other technology companies, has led some to question whether there is a new technology bubble, Bloomberg News writes.
BLOOMBERG NEWS

LEGAL/REGULATORY »

State Regulator Halts Deal Between Wells Fargo and Loan Servicer  |  The office of Benjamin Lawsky, the superintendent of New York’s Department of Financial Services, has halted the transfer of about $39 billion in servicing rights to Ocwen from Wells Fargo.
DealBook »

Ex-Brokerage Executives Charged With Fraud  |  The owner and two executives of the WJB Capital Group were arrested on Thursday and accused of defrauding at least 15 investors out of more than $11 million during the waning days of their now-defunct brokerage company.
DealBook »

Answer to Puerto Rico’s Debt Woes? It’s Complicated  |  Puerto Rico is in a jam, writes Stephen J. Lubben. It is not considered a state, which means it can’t resort to bankruptcy to deal with its debt problems. Nor is it a sovereign nation, which means it can’t rely on sovereign immunity.
DealBook »

How Ben Horowitz Avoided an Options Backdating Scandal  |  Ben Horowitz, a co-founder of the venture capital firm Andreessen Horowitz, said in a blog post on Thursday that he narrowly avoided getting caught up in the options backdating investigations that swept corporate America in 2006. He details how.
DealBook »

Fischer to Sell Shares in Financial Companies to Join Fed  |  Stanley Fischer, the former governor of the Bank of Israel nominated to become the vice chairman of the Federal Reserve, said he would sell his shares in financial companies if he were to be confirmed, Bloomberg News reports. Mr. Fischer amassed most of his fortune, which could total as much as $56.3 million, when he was serving as vice chairman of Citigroup from 2002 to 2005.
BLOOMBERG NEWS

British Regulator Hires Former Goldman and UBS Executive

LONDON - The Financial Conduct Authority of Britain said Friday that it had hired a former managing director at Goldman Sachs and UBS as an adviser in its division that supervises wholesale banking and investment management.

The British financial regulator said that James Kelly, in a part-time role, will advise the F.C.A. on supervision strategy and provide insight into the investment banking sector.

“It’s vital that we continue to appoint individuals with sector-specific expertise into the F.C.A., and James has that in spades,” Clive Adamson, the F.C.A.’s director of supervision, said in a statement. “His knowledge of the market and strategic insight will be hugely valuable.”

The F.C.A. has hired several former industry executives in the past year to expand its expertise in the sector.

Robert Taylor, the former chief executive of the British private bank Kleinwort Benson, recently joined the F.C.A. as head of wealth management and private banking in its supervision division. Karina McTeague joined the regulator as director of retail banking last year from Lloyds Banking Group.

Mr. Kelly was a managing director in derivatives cross-product sales at Goldman Sachs from 2007 to 2012 and worked as a managing director in risk management products at UBS from 1993 to 2007. He started in the industry in 1985.

He will start immediately and report to Will Amos, director of the wholesale banking and investment management division, the F.C.A. said.

“The investment banking sector continues to experience considerable change, especially with regards to regulation,” Mr. Kelly said in a statement. “I’m looking forward to sharing my experience with Clive, Will and the rest of the team.”

A Guilty Verdict for Former SAC Trader

FORMER SAC TRADER CONVICTED OF INSIDER TRADING  |  A federal jury in Manhattan found Mathew Martoma guilty on Thursday of insider trading , culminating a case that prosecutors had never thought would go to trial in the first place. The case may be the last criminal case to emerge from a decade-long investigation of Steven A. Cohen and his SAC Capital Advisors hedge fund, Alexandra Stevenson and Matthew Goldstein write in DealBook. Mr. Martoma, who is married and has three young children, is expected to face a prison sentence of seven to 10 years.

Mr. Martoma is the 79th person â€" and the eighth person who once worked for Mr. Cohen â€" to either be convicted at trial or plead guilty to insider trading since the current crackdown on insider trading in the hedge fund industry began in 2009. With this latest conviction, the United States attorney’s office in Manhattan extends an unbroken string of successes in prosecuting such cases.

Mr. Martoma’s case was notable because it was the first time that Mr. Cohen was linked to questionable trades at his firm. Throughout the course of the trial, prosecutors proved that Mr. Martoma was guilty of seeking out confidential information related to a clinical trial for an experimental Alzheimer’s drug. The inside information, largely provided by an aging doctor familiar with the results of the clinical trial who was the government’s star witness, helped SAC avoid losses and generate profits totaling $275 million in July 2008.

PAST FICTIONS, LACK OF TRUST AND NO DEAL  |  After F.B.I. agents confronted Mathew Martoma in November 2011 at his home in Boca Raton, Fla., prosecutors spent the next years raising the possibility that Mr. Martoma could strike a cooperation deal. The insistence of Mr. Martoma’s lawyers that he would not make a potentially favorable deal for himself baffled many, especially as the case headed to trial. And now, with Mr. Martoma facing years in prison away from his family, the case’s fundamental mystery has only deepened, James B. Stewart writes in the Common Sense column.

The answer may lie in a confidential report from Mr. Martoma’s disciplinary hearing at Harvard Law School after the discovery that he had altered his transcript to improve his grades in his quest for a judicial clerkship. “How Mr. Martoma handled the Harvard affair, detailed in the confidential report by the law school’s administrative board after what appeared to have been lengthy proceedings, may well have proved devastating to his credibility, and thus to his ability to cut a favorable deal,” Mr. Stewart writes.

THE RISE AND FALL OF A BITCOIN LEADER  |  When Charles Shrem was arrested and charged last month with conspiring to launder money by helping people who wanted to buy drugs exchange dollars into Bitcoin, it seemed as if the Bitcoin world had lost one of its most charismatic, if not most powerful, leaders. Indeed, this was the man who went through millions of dollars’ worth of Bitcoin over the years. But Mr. Shrem’s Bitcoin vision has collided with the real world, and now his own future is uncertain, Nathaniel Popper writes in DealBook.

And yet, in an interview on Thursday, Mr. Shrem’s exuberance was still on display. “Given the opportunity, I will get back on the speaking circuit and be an evangelizer for Bitcoin,” he said in the interview. “At the same time, the more high-profile you are, the more careful you have to be. It’s scary.”

Mr. Popper writes on Mr. Shrem: “His recent reversal of fortune â€" and the meteoric ascent that led up to it â€" makes him a living symbol of the peaks and valleys that have so far defined the Bitcoin experience.”

ON THE AGENDA  |  The big one: January’s jobs report is out at 8:30 a.m. The debt ceiling deadline is today. Alan Greenspan, the former Federal Reserve chairman, is on CNBC at 7:30 a.m. Natalie Massenet, the founder of the online luxury retailer Net-a-Porter, is on Bloomberg TV at 4 p.m. The 2014 Winter Olympics opening ceremony is on NBC at 7:30 p.m.

HERE WE GO AGAIN  |  On Friday, the United States Treasury loses its authority to issue bonds, setting off the fourth debt ceiling fight in three years. “This is the dying gasp of a dead-end strategy,” Representative Peter Welch, a Vermont Democrat, said in an article in The New York Times. “I think this fight is over.”

APPLE BUYS $14 BILLION OF ITS OWN STOCK  |  In the two weeks since Apple reported disappointing fourth-quarter results, the company has repurchased an unprecedented $14 billion of its own stock. Tim Cook, Apple’s chief executive said he was “surprised” by Apple’s decline in share price and wanted to be “aggressive” and “opportunistic,” The Wall Street Journal reports. “It means that we are betting on Apple. It means that we are really confident on what we are doing and what we plan to do,” Mr. Cook said.

Apple’s buyback coincides with calls by Carl C. Icahn, who owns about $4 billion in Apple shares, for the company to use its stockpile of cash to buy back shares. In a bit of a tease, Mr. Cook also said that, while Apple has not made big acquisitions in the past, history doesn’t preclude his company from making a large deal “for the right fit that’s in the best interest of Apple in the long term.”

ICAHN 2.0  |  In the 1980s, Carl C. Icahn was known as a “vulture capitalist” who got rich during the leveraged buyout boom. Now, he’s called an “activist investor,” but his tactics can be traced to his past. And today, says one trader, “A lot of times, even when he gets nothing he asks for, he wins.”

IF YOU CARE ABOUT SPORTS  |  Kevin Durant knows all about being No. 2. He was selected second in the N.B.A. draft in 2007, was second in the M.V.P. voting three times and led his team, the Oklahoma City Thunder, to a second-place league finish in 2012. He was also the No. 2 shoe salesman last year.

AND ABOUT THAT VENTURE CAPITALIST WHO THOUGHT HE COULD BE AN OLYMPIAN  |  Paul Bragiel, the venture capitalist, may have tried, and failed, to qualify for the 2014 Winter Olympics by joining the Colombian cross-country ski team, but he is still making his presence known in Sochi, Russia. On Friday, he plans to release an Olympic-themed mobile game called Team Paul Skiing.

Mergers & Acquisitions »

Illinois Tool Works Sells Packaging Unit to Carlyle Group  |  The Carlyle Group is paying $3.2 billion for the unit, which produces a range of products used in shipping and transportation.
DealBook »

Green Mountain’s Deal With Coke Fails to Dent SodaStream  |  Analysts and investors think that a deal between Coke and Green Mountain may presage another one: some sort of tie-up between SodaStream and Coke’s archrival, PepsiCo.
DealBook »

Vodafone’s Investment Case Will Involve Deal-Making  |  Vodafone will be probably be interested in deals that will give it fixed-line networks in places where it cannot build or rent others on favorable terms, writes Quentin Webb of Reuters Breakingviews.
DealBook »

Amazon Acquires Video Gaming Studio  |  Amazon has purchased the video gaming studio Double Helix Games, TechCrunch reports. The acquisition announcement had been planned for later this month, but news of the deal was leaked in an invitation to a joint recruiting event from Amazon and Double Helix Games. The financial terms of the deal have not been disclosed.
TECHCRUNCH

I.B.M. Considers Sale of Chip Manufacturing Operations  |  I.B.M. is looking to sell its semiconductor manufacturing operations, The Wall Street Journal reports, citing an unidentified person.
WALL STREET JOURNAL

Jos. A. Bank’s Resistance to Merger Wears Down Traders  |  Jos. A. Bank’s stock price has fallen 7 percent below the bid by Men’s Wearhouse of $57.50 a share, which could indicate that investors do not expect the companies to agree on a deal, Bloomberg News reports.
BLOOMBERG NEWS

INVESTMENT BANKING »

Senator Warren Questions Dimon’s Pay Raise  |  Senator Elizabeth Warren called out regulators at a Senate banking committee hearing on Thursday, questioning the effectiveness of regulatory enforcement given the hefty 2013 bonus that Jamie Dimon, JPMorgan Chase’s chairman and chief executive, received, The Financial Times writes.
FINANCIAL TIMES

Swiss Firm Mercuria in Talks to Buy JPMorgan’s Commodities Unit  |  JPMorgan Chase has been exploring strategic alternatives, including a possible sale or spinoff, for the business, which deals in physical commodities like metals and oil.
DealBook »

Barclays Names Junior Trader as Chief of Foreign Exchange Desk  |  Barclays has appointed Daniel Ryan, a junior trader, as the interim chief of the bank’s London spot foreign exchange desk, The Financial Times writes. The move underscores the thinning out of ranks at the bank because of a global inquiry into allegations of currency market manipulation.
FINANCIAL TIMES

PRIVATE EQUITY »

Sony Turns to Investment Firm With a Taste for Unloved Assets  |  Japan Industrial Partners, a little-known Japanese private equity firm that specializes in scouting the electronics landscape for turnaround opportunities, said it would buy Sony’s unprofitable personal computer unit.
DealBook »

K.K.R. Profit More Than Doubled in Fourth Quarter  |  Rising markets helped the private equity firm Kohlberg Kravis Roberts reap big gains from its investments.
DealBook »

Italian Banks Discuss Fund for Bad Loans With K.K.R.  |  Intesa Sanpaolo and UniCredit, Italy’s two top banks, are discussing setting up a bad loans vehicle with the private equity firm Kohlberg Kravis Roberts & Company, Reuters writes, citing unidentified people. The vehicle would help the Italian banks take troubled assets off of their balance sheets.
REUTERS

AEA Considering Purchase of Gypsum Management and Supply  |  The private equity firm AEA Investors is nearing a deal valued at over $700 million to buy Gypsum Management and Supply, a company that makes specialty building materials like drywall, Reuters reports, citing unidentified people familiar with the situation.
REUTERS

HEDGE FUNDS »

Hedge Funds Bet on U.S. Gas Shortage  |  Hedge funds are betting that the United States will face a natural gas shortage before the spring because of the below-average temperatures that have been sweeping the country this winter, The Financial Times writes.
FINANCIAL TIMES

Traders Overhauling Foreign Exchange Positions  |  Hedge fund traders are shuffling their currency holdings after turmoil in the emerging markets that led to the roughest start to the year for currency funds since 2004, Bloomberg News reports.
BLOOMBERG NEWS

I.P.O./OFFERINGS »

Glassdoor, a Jobs Website, Hires a Finance Chief  |  Glassdoor announced that it has hired Adam C. Spiegel as chief financial officer, potentially setting up an initial public offering of the company down the line.
DealBook »

Chinese Drug Company Plans $750 Million I.P.O.  |  Luye Pharma Group, a drug company controlled by Chinese private equity firms, is aiming to raise about $750 million in an initial public offering in Hong Kong, The Wall Street Journal reports.
WALL STREET JOURNAL

Sanborns I.P.O. Proves Too Expensive  |  One year after Grupo Sanborns, a large chain of restaurants and retail stores, filed for an initial public offering, many investors think the the I.P.O. was too expensive, Bloomberg News writes.
BLOOMBERG NEWS

VENTURE CAPITAL »

Venture Capital’s Woman Problem  |  Only 4 percent of senior venture capitalists are women, Fortune reports.
FORTUNE

Vungle Raises $17 million  |  Vungle, a start-up that sells video ads that run within mobile applications, said it had collected $17 million in Series B funding led by Thomvest Ventures, ReCode reports.
RECODE

Truecaller Receives $19 Million in Funding  |  Truecaller, a Swedish company that makes a phone number identification application, said on Thursday that it had raised $19 million from venture capital firms led by Sequoia Capital, The Wall Street Journal reports.
WALL STREET JOURNAL

Technology Companies May Be Overvalued  |  The precipitous drop in Twitter’s share price on Thursday, along with similar declines for other technology companies, has led some to question whether there is a new technology bubble, Bloomberg News writes.
BLOOMBERG NEWS

LEGAL/REGULATORY »

State Regulator Halts Deal Between Wells Fargo and Loan Servicer  |  The office of Benjamin Lawsky, the superintendent of New York’s Department of Financial Services, has halted the transfer of about $39 billion in servicing rights to Ocwen from Wells Fargo.
DealBook »

Ex-Brokerage Executives Charged With Fraud  |  The owner and two executives of the WJB Capital Group were arrested on Thursday and accused of defrauding at least 15 investors out of more than $11 million during the waning days of their now-defunct brokerage company.
DealBook »

Answer to Puerto Rico’s Debt Woes? It’s Complicated  |  Puerto Rico is in a jam, writes Stephen J. Lubben. It is not considered a state, which means it can’t resort to bankruptcy to deal with its debt problems. Nor is it a sovereign nation, which means it can’t rely on sovereign immunity.
DealBook »

How Ben Horowitz Avoided an Options Backdating Scandal  |  Ben Horowitz, a co-founder of the venture capital firm Andreessen Horowitz, said in a blog post on Thursday that he narrowly avoided getting caught up in the options backdating investigations that swept corporate America in 2006. He details how.
DealBook »

Fischer to Sell Shares in Financial Companies to Join Fed  |  Stanley Fischer, the former governor of the Bank of Israel nominated to become the vice chairman of the Federal Reserve, said he would sell his shares in financial companies if he were to be confirmed, Bloomberg News reports. Mr. Fischer amassed most of his fortune, which could total as much as $56.3 million, when he was serving as vice chairman of Citigroup from 2002 to 2005.
BLOOMBERG NEWS

British Regulator Hires Former Goldman and UBS Executive

LONDON - The Financial Conduct Authority of Britain said Friday that it had hired a former managing director at Goldman Sachs and UBS as an adviser in its division that supervises wholesale banking and investment management.

The British financial regulator said that James Kelly, in a part-time role, will advise the F.C.A. on supervision strategy and provide insight into the investment banking sector.

“It’s vital that we continue to appoint individuals with sector-specific expertise into the F.C.A., and James has that in spades,” Clive Adamson, the F.C.A.’s director of supervision, said in a statement. “His knowledge of the market and strategic insight will be hugely valuable.”

The F.C.A. has hired several former industry executives in the past year to expand its expertise in the sector.

Robert Taylor, the former chief executive of the British private bank Kleinwort Benson, recently joined the F.C.A. as head of wealth management and private banking in its supervision division. Karina McTeague joined the regulator as director of retail banking last year from Lloyds Banking Group.

Mr. Kelly was a managing director in derivatives cross-product sales at Goldman Sachs from 2007 to 2012 and worked as a managing director in risk management products at UBS from 1993 to 2007. He started in the industry in 1985.

He will start immediately and report to Will Amos, director of the wholesale banking and investment management division, the F.C.A. said.

“The investment banking sector continues to experience considerable change, especially with regards to regulation,” Mr. Kelly said in a statement. “I’m looking forward to sharing my experience with Clive, Will and the rest of the team.”