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Ivy Schmerken
Ivy Schmerken
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A Hedge Fund for Tony Hayward?

The former CEO of BP resurfaces from the Gulf oil spill to reinvent himself as a hedge fund manager.

Tony Hayward, the former CEO of BP, is close to picking a new career that will reinvent himself as a hedge fund manger. The Financial Times is reporting that BP's ousted CEO, who was one of the most hated CEOs in America at the time of the Gulf Oil spill crisis, is in the early stages of starting an investment fund to focus on the energy sector. And with gas prices increasing at the pump from political unrest in Libya and America's high dependency on foreign oil, Hayward is obviously looking to capitalize on a profitable sector.

From The Financial Times:

The talks remain at an early stage and an investment fund is only one of a number of options Mr Hayward is considering, people close to him stressed on Monday. He has also been in talks to become the senior independent director of Glencore, the commodities trader, when it lists.

Mr Hayward has previously held talks with Nat Rothschild, the billionaire financier, about launching an investment fund. The two men know each other well and any venture could be modelled on Vallar, the natural resources fund Mr Rothschild listed in London last year, according to people familiar with the situation.

Mr Hayward also held preliminary talks with Julian Metherell who recently announced his intention to retire as the head of UK investment banking at Goldman Sachs to a small group of senior executives there, according to people familiar with the matter.

But if Hayward starts a hedge fund, will he need to watch his words with prickly investors? Does Hayward have the temperament for dealing with investor inquiries and compliance rules under Dodd-Frank or the European Commission? After all, it was Hayward after the Gulf oil spill accident polluted Louisiana waters, killed wildlife and ruined the Gulf region's economy, who uttered the infamous words: "I want my life back." Also, Hayward went on his yacht at the height of the crisis, while the wells continued to spew oil into the Gulf for 87 days.

But Hayward profusely apologized for his insensitive comments and seemed genuinely sorry for his comments. He also testified before Congress that he was "deeply sorry" for the April 2010 catastrophic Gulf coast oil spill triggered by the April 2010 explosion of the Deep Horizon oil rig. But lawmakers heavily criticized him for being oblivious to the risks of his company's deep water drilling.

So I wonder will Hayward seek to invest in green energy companies -- or more likely oil exploration companies that are more likely to drill in pristine waters? It's hard to think of Hayward as presiding over an ecologically minded investment policy, but if this would reap alpha, I'm sure he would go for it.

Coincidentally, news of Hayward's career move comes at time when BP hopes to resume deep-water drilling in the Gulf of Mexico this summer. In the fall, the government lifted a presidential ban on drilling in the gulf, which accounts for 29 percent of domestic crude oil production, according to media reports. BP pumps some 400,000 barrels a day out of the gulf, making it the largest oil producer in the region, according to an article from The Washington Post.

The company is also the largest leaseholder in deep-water areas of the gulf.

Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio
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