Pirates say they do not fear fighters



MOGADISHU // Tension mounted yesterday between pirates holding a Saudi tanker and Islamist fighters threatening to attack them, with a week remaining for the ship's owners to meet a ransom demand of US$25 million (Dh92m). "If the pirates want peace, they had better release the tanker," Sheikh Ahmed, a spokesman for the Shebab group in the coastal region of Harardhere, said by phone.

The Sirius Star, a huge tanker carrying around $100m worth of crude oil owned by Saudi Aramco, was hijacked in the space of 16 minutes by Somali pirates in the Indian Ocean on Nov 15. Pirates have since anchored it off their base in Harardhere, north of Mogadishu, and demanded the ransom be paid by Sunday. The Shebab (youth) armed group, which controls much of southern and central Somalia and rejects an internationally backed peace process, has positioned fighters in and around Harardhere in recent days.

Islamist leaders have stressed that piracy is a capital offence under Islam and officially condemned the surge in acts of piracy in Somalia's waters, which has begun to disrupt international trade. A member of the pirate group holding the Sirius Star retorted that his own men were not afraid of Shebab's threats. "We are the Shebab of the sea and we can't be scared by the Shebab of the land," Mohamed Said said. "If anybody attempts to attack, that would be suicide."

Mr Said announced on Thursday that his group was demanding $25m to release the vessel, which is carrying the equivalent of almost one quarter of Saudi Arabia's daily output. "I am not on the tanker at the moment because I am co-ordinating what is happening on the ground," he said. "There is a small Shebab vanguard on the ground, but we also have a strong presence. Every Somali has great respect for the holy kingdom of Saudi Arabia. We have nothing against them, but unfortunately what happened was just business for us and I hope the Saudis will understand."

Some residents in Harardhere have said the Shebab are divided over the issue of piracy and that some of the Islamist fighters have moved into the region only to claim a share of the ransom. Members of the pirate group said on Saturday that talks were underway with Saudi Aramco's shipping arm and assured that the crew would not be harmed. No breakthrough had yet been achieved, the group said. "I hope the owner of the tanker is wise enough and won't allow any military option because that would be disastrous for everybody. We are here to defend the tanker if attacked," Abdiyare Moalim, another member of the group, said.

The capture of the Sirius Star, the biggest ship ever hijacked, and its oil cargo has sowed panic in the shipping world, with companies now rerouting deliveries via the Cape of Good Hope, adding substantial time and transit costs. Over the past week, two major shipping industry players, Odfjell of Norway and AP Moeller-Maersk of Denmark, have announced that part or all of their fleets will from now on sail around South Africa's southern tip.

Pirates operating from Somalia currently hold at least 17 ships, including a Ukrainian cargo vessel carrying 33 combat tanks destined for South Sudan. * Agence France-Presse

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The Freedom Artist

By Ben Okri (Head of Zeus)

The struggle is on for active managers

David Einhorn closed out 2018 with his biggest annual loss ever for the 22-year-old Greenlight Capital.

The firm’s main hedge fund fell 9 per cent in December, extending this year’s decline to 34 percent, according to an investor update viewed by Bloomberg.

Greenlight posted some of the industry’s best returns in its early years, but has stumbled since losing more than 20 per cent in 2015.

Other value-investing managers have also struggled, as a decade of historically low interest rates and the rise of passive investing and quant trading pushed growth stocks past their inexpensive brethren. Three Bays Capital and SPO Partners & Co., which sought to make wagers on undervalued stocks, closed in 2018. Mr Einhorn has repeatedly expressed his frustration with the poor performance this year, while remaining steadfast in his commitment to value investing.

Greenlight, which posted gains only in May and October, underperformed both the broader market and its peers in 2018. The S&P 500 Index dropped 4.4 per cent, including dividends, while the HFRX Global Hedge Fund Index, an early indicator of industry performance, fell 7 per cent through December. 28.

At the start of the year, Greenlight managed $6.3 billion in assets, according to a regulatory filing. By May, the firm was down to $5.5bn. 

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