Will SAC buy Fidelity?

Fidelity has been more 'activist' than other funds...

The funds have gotten lots of heat for their staunch support of management, with critics questioning if funds are upholding their legal obligations to vote in the best interest of their shareholders if they take management's side.

But some mutual funds appear to be warming up to the activist role, perhaps because of new rules that requiring fund companies to disclose how they vote in corporate elections. They also face increased competition for investors' money, especially from hedge funds.

...Fidelity Investments took a prominent role in opposing the proposed $19 billion takeover of U.S. radio broadcaster Clear Channel Communications Inc. by the private-equity firms Bain Capital Partners and Thomas H. Lee Co. Fidelity and other investors against the deal, which has yet to go to a shareholder vote, think the company is worth more than the $37.60-a-share offer.(read more...)

Fidelity and hedge funds have already been trading employees...

Fidelity Management & Research Co. (FMR Co.), the investment management division of Fidelity Investments, hired Brian Conroy as SVP and head of global equity trading. Conroy will be responsible for setting the strategic direction of domestic and international trading and will serve as the point person for both desks. He will have five direct reports, who, in turn, will manage FMR Co.'s trading force, says a Fidelity spokesman, who declines to reveal the number of Fidelity equity traders.

Conroy joins FMR Co. from New York-based Sigma Capital Management, where he served as COO. Prior to assuming the COO role, Conroy was a head trader with the $6.5 billion Stamford, Conn.-based hedge fund, SAC Capital Management - a Sigma affiliate. He also held positions at JPMorgan, Goldman Sachs and ABN AMRO. (read more...)

And Mutual funds have been losing people to hedge funds like crazy. From 2004:

In the face of legislation, lawsuits and media criticism, mutual funds have become significantly more cautious. They can't afford to become associated with any more scandals or be on the wrong side of any potential legislation. Mutual funds continue to lose their most successful fund managers and research analysts to unregulated hedge funds where such managers and analysts can make far more money with far less scrutiny. As if the brain drain wasn't bad enough, mutual funds can no longer (by virtue of their huge asset bases) command proprietary information from companies since Regulation FD mandates that all investors receive material information concurrently. (read more...)

Specifically, Fidelity lost people to London's TCI fund managment, and Highbridge Capital Management...(read more...)

Fidelity and SAC track each other's investments (at least some of the time). They were/are both big holders in...
>Martha Stewart Living
>Pacific Sunwear (read more...)
>Take-Two
etc...

What would SAC gain? $$$$$$ (and it's all about the money...)

President, Fidelity Employer Services
JOHNSON IS WIDELY believed to be next in line to run Fidelity, the $1.1 trillion mutual fund giant founded by her grandfather and now run by her father, Edward. Indeed, as the new head of Employer Services, a fast-growing unit that does benefit and payroll outsourcing that covers 19 million workers and retirees, Johnson, 44, is the driving force behind a transformation that will turn the company into a financial-services juggernaut. Fidelity watchers believe that a generation of consumers will receive their most important financial documents stamped or processed by a Fidelity computer, from their first pay stub to their last retirement check. "Abigail is running the company's next trillion-dollar business," says James Lowell, editor of the Fidelity Investor newsletter. "She is already CEO of the new Fidelity." (read more...)

The bottom line, though: Fidelity would be a cheap acquisition right now...

And...Fidelity is in the business of streamlining...From April 15, 2007:

BOSTON (MarketWatch) -- The mutual fund industry is a survival-of-the-fittest world where management companies frequently kill off their weakest offspring by merging them into their best and healthiest issues.
So when one of the industry's biggest players announces plans to merge two issues into sister funds, it's no big deal.()