Hedge Fund Takes Aim At eSpeed

Mar 16 2007 | 12:26pm ET

A Los Angeles hedge fund is seeking to wrest control of electronic trading network eSpeed from Cantor Fitzgerald in its bid to get eSpeed put on the market.

Chapman Capital filed a Schedule 13D yesterday with the Securities and Exchange Commission, hoping to compel eSpeed’s board of directors to convert all Class B shares—which have 10 votes each and are used by Cantor and its CEO, Howard Lutnick, to control the firm—into regular Class A common shares, with one vote apiece. Cantor and Lutnick own a minority stake in the company; Chapman controls 9.3% of eSpeed’s common stock.

“Particularly in light of eSpeed’s Feb. 13, 2007, disclosure regarding its weak 2007 financial outlook and incongruous granting of free stock options representing nearly 3% of the outstanding Class A common shares to the executive most responsible for such operating underperformance, Mr. Howard W. Lutnick, the company’s ownership base has conveyed a nearly uniform desire for eSpeed’s Class A shares to be maximized through a change-of-control transaction,” Chapman Capital managing member Robert Chapman said.

Chapman said his firm has begun contacting eSpeed’s competitors to gauge interest in the firm.


In Depth

Malik: The Science of Deal Sourcing 201

Aug 27 2015 | 5:35pm ET

Deal sourcing is understandably a hot topic among private equity firms because it...

Lifestyle

Rolling Art Advisors Marketing Collectible Car Fund As Uncorrelated Alternative

Aug 27 2015 | 6:47pm ET

A new fund is trying to provide investors with greater access to an emerging asset...

Guest Contributor

FATCA for Hedge Funds: Eight Common Pitfalls

Sep 1 2015 | 10:56am ET

FATCA is now a way of life for those in the financial industry and most professionals...

 

Editor's Note