Short seller Nathan Anderson wants to close Hindenburg Research

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Activist short seller Nathan Anderson, famous for his campaigns against Adani Group, Super Micro and Nikola, is closing his firm Hindenburg Research seven years after it was founded.

“The plan was to end it as soon as we completed the pipeline of ideas we were working on,” Anderson said wrote in a statement. He described the job as “pretty intense and sometimes all-encompassing.”

Anderson had become one of Wall Street’s most prominent activist short sellers, known for his meticulously detailed reports and his tireless pursuit of companies he believed had committed fraud.

Its rise came at a time when many competitors were losing momentum, hampered by a decade-long bull market and the growth of passive investment funds that made it difficult to swim against the tide.

Renowned short seller Jim Chanos told investors he would close his short funds in November 2023 after more than three decades in the industry, while Bill Ackman, famous for a costly campaign against Herbalife, has sworn off the practice entirely.

Activist short selling is a notoriously difficult business that is typically avoided by major Wall Street institutions. Smaller players tend to enter into balance sheet agreements with partners Hedge funds and receive a reduction in fees, but are the flagship of public campaigns.

Hindenburg worked on one with a small New York firm called Kingdon Capital Number of his trades.

The practice can also be legally questionable. Last year, U.S. regulators charged Andrew Left, a short seller and founder of Citron Research, with fraud over alleged market manipulation. He pleaded not guilty and the trial is scheduled for September.

Despite all the challenges, advocates believe short selling is necessary to offset market euphoria.

Hindenburg was prolific and often targeted several large companies at once, an intensity that apparently became too much for Anderson. “This comes with the loss of much of the rest of the world and the people I care about,” he wrote in a letter published Wednesday. “It wasn’t always obvious to me, but I see it all as a love story now.”

Hindenburg’s last published report came out earlier this year and focused on online car retailer Carvana.

Anderson gained notoriety with a report against electric truck maker Nikola, then a darling of the boom in companies going public through shell companies known as special purpose acquisition companies.

The report included the now infamous video of a truck rolling downhill and led to the conviction of founder Trevor Milton for fraud and a $125 million fine paid by the company.

The case attracted significant media interest and gave Anderson a large following, who eagerly awaited Hindenburg reports and speculated about his next potential targets.

According to his website, Hindenburg’s research has led to allegations of fraud and indictments against dozens of people, as well as costly legal battles. The company only had 11 employees.

Hindenburg also relied on unconventional research methods.

When the company got to the bottom of a suspected Ponzi scheme in 2022, it outfitted a private jet with equipment to secretly record a company representative making a pitch to a Hindenburg employee.

Anderson began investigating corporate misconduct by targeting hedge funds. According to Hindenburg’s website, he filed his first whistleblower report with the U.S. Securities and Exchange Commission in 2014.

Anderson took on some of Wall Street’s most famous investors, including another activist, Carl Icahn. A report on Icahn Enterprises published by Hindenburg in 2023 shares sent The company lost 20 percent, forcing the billionaire to restructure his personal loans.

“We all worked extremely hard, focused on precision and let the evidence dictate our words,” Anderson wrote in Wednesday’s announcement. “Sometimes that meant taking big swings and facing battles much bigger than any one of us.”

Anderson’s parting gift to his followers was a YouTube link to a DJ set played in Bali. “It had a huge impact on me at a crucial time,” he wrote.