Saw the following story on another sports website. Could not find the exact source but did find two other similar links at:
http://online.wsj.com/article/SB122221505732769415
and
Link: http://www.tulsaworld.com/business/article.aspx?ar
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Boone's Big $ 165MM Donation Trickles Down to the Nibbits - Future Facility Expansion in Doubt
STILLWATER -- OSU Regents were reportedly told Friday afternoon that the portion of the Boone Pickens donation in the BP Capital hedge fund was virtually wiped out by margin calls on the funds investments in the third quarter.
Pickens is the founder of BP Capital and is a principal of TBP and BPC. Mr. Pickens is active in the management of both the Equity Fund and the Energy Fund.
Almost every living fan has had to be reminded about the huge $165 million contribution that Pickens made to Oklahoma State's athletic department back in 2005. But that gift has been significantly suspicious, and under increasing scrutiny, since it's pledge date.
According to the New York Times, the funds were actually in the OSU Foundation bank account for less than an hour, before being 'invested' back into BP Capital.
On top of that, the donation was made with the stipulation that it be managed by solely by OSU AD Mike Holder, a hire of Mr. Pickens, and Mr. Pickens himself.
While it worked out well in '06 and '07, unfortunately Pickens has stumbled on oil all year. When it first hit $100 (going up) he shorted, losing a lot. Then he switched to being long, only to get hit again when it came down. Then, BP Capital had a rough July, where it was down almost 35%, causing OSU AD Mike Holder to announce that ground breaking on the indoor practice facility, and the athletic villiage had been put on hold.
When asked the reason, Holder replied, "Have you seen the price of oil lately?"
Hindsight, always 20/20, indicates that the Poke AD and Pickens should have cleaned out the closets and gone straight to the bank -- as oil was at $ 120 bbl at the time the 'hold' was put on. Since then, prices have dropped considerably more.
When the fund had nearly doubled the original gift, several OSU Regents had strongly suggested that the original $ 165MM be taken out of the volatile hedge fund and put in the bank.
However, Pickens balked at the advice, and suggested that stadium expansion be made with funds borrowed against the assets of the fund. Complicating the entire fiasco, the OSU athletic department was in the tank by more than $ 100MM in 2005, and it is unclear if that deficit has been made.
One disgruntled donor is reported to be Oklahoma City investor Sherman Smith, who made a $ 20MM donation to the indoor practice facility that now may be delayed for some time. Smith may wonder just where his $ 20MM went.
Through August. the BP commodity fund was down 84% since January 2008, and things have only worsened since.
Pickens said at the time,
"It's my toughest run in 10 years.... We missed the turn in the market, there's nothing fun about it. I'm not willing to accept that [the downturn] was due to a global slowdown. When there's deleveraging in markets it will affect everything."
Even those were heady days compared to mid October.
The mandated SEC release of BP Capital's holdings at the end of the third quarter should be forthcoming next week, and it is believed that the bad news given to the OSU Regents Friday was done in preparation for the potentially traumatic news.
Two weeks ago, Pickens said on CNBC that about 15 percent of people who held a position in his fund expressed that they wanted out by the end of the year.
With the Cowboys playing in Boone Pickens Stadium, that's clearly not an option for the Oklahoma State athletic department. Withdrawing the funds would be a slap in the face to their biggest benefactor, who only six months ago was being hailed as a genius, and the anointed savior of O-State athletics.
http://online.wsj.com/article/SB122221505732769415
and
Link: http://www.tulsaworld.com/business/article.aspx?ar
--------------------------------------------
Boone's Big $ 165MM Donation Trickles Down to the Nibbits - Future Facility Expansion in Doubt
STILLWATER -- OSU Regents were reportedly told Friday afternoon that the portion of the Boone Pickens donation in the BP Capital hedge fund was virtually wiped out by margin calls on the funds investments in the third quarter.
Pickens is the founder of BP Capital and is a principal of TBP and BPC. Mr. Pickens is active in the management of both the Equity Fund and the Energy Fund.
Almost every living fan has had to be reminded about the huge $165 million contribution that Pickens made to Oklahoma State's athletic department back in 2005. But that gift has been significantly suspicious, and under increasing scrutiny, since it's pledge date.
According to the New York Times, the funds were actually in the OSU Foundation bank account for less than an hour, before being 'invested' back into BP Capital.
On top of that, the donation was made with the stipulation that it be managed by solely by OSU AD Mike Holder, a hire of Mr. Pickens, and Mr. Pickens himself.
While it worked out well in '06 and '07, unfortunately Pickens has stumbled on oil all year. When it first hit $100 (going up) he shorted, losing a lot. Then he switched to being long, only to get hit again when it came down. Then, BP Capital had a rough July, where it was down almost 35%, causing OSU AD Mike Holder to announce that ground breaking on the indoor practice facility, and the athletic villiage had been put on hold.
When asked the reason, Holder replied, "Have you seen the price of oil lately?"
Hindsight, always 20/20, indicates that the Poke AD and Pickens should have cleaned out the closets and gone straight to the bank -- as oil was at $ 120 bbl at the time the 'hold' was put on. Since then, prices have dropped considerably more.
When the fund had nearly doubled the original gift, several OSU Regents had strongly suggested that the original $ 165MM be taken out of the volatile hedge fund and put in the bank.
However, Pickens balked at the advice, and suggested that stadium expansion be made with funds borrowed against the assets of the fund. Complicating the entire fiasco, the OSU athletic department was in the tank by more than $ 100MM in 2005, and it is unclear if that deficit has been made.
One disgruntled donor is reported to be Oklahoma City investor Sherman Smith, who made a $ 20MM donation to the indoor practice facility that now may be delayed for some time. Smith may wonder just where his $ 20MM went.
Through August. the BP commodity fund was down 84% since January 2008, and things have only worsened since.
Pickens said at the time,
"It's my toughest run in 10 years.... We missed the turn in the market, there's nothing fun about it. I'm not willing to accept that [the downturn] was due to a global slowdown. When there's deleveraging in markets it will affect everything."
Even those were heady days compared to mid October.
The mandated SEC release of BP Capital's holdings at the end of the third quarter should be forthcoming next week, and it is believed that the bad news given to the OSU Regents Friday was done in preparation for the potentially traumatic news.
Two weeks ago, Pickens said on CNBC that about 15 percent of people who held a position in his fund expressed that they wanted out by the end of the year.
With the Cowboys playing in Boone Pickens Stadium, that's clearly not an option for the Oklahoma State athletic department. Withdrawing the funds would be a slap in the face to their biggest benefactor, who only six months ago was being hailed as a genius, and the anointed savior of O-State athletics.