Another John Meriwether fund is said to be shutting down after heavy losses: Read the rest of this entry »
Tags: Hedge funds, John Meriwether, Liquidations / implosions, LTCM, Toe Tags
Another one bites the dust: Former LTCM founder John Meriwether’s Relative Value Opportunity II fund shutting down
On July - 8 - 2009
Another one bites the dust: David Rocker founded Hedge fund Copper River is liquidating
On December - 9 - 2008
Copper River Management, the fund founded by legendary short seller David Rocker and which is currently run by his former Rocker Partners co-manager Marc Cohodes, is liquidating with remaining funds being returned to investors. The fund was said to have been down over 50% In the market turmoil over the past couple of months with results exacerbated by the SEC imposed short selling restrictions as well as its inability to unwind derivatives where Lehman was the counterparty….
Tags: Christopher Cox, Credit Crunch, Rocker Partners, Toe Tags
Nine Citigroup hedge funds have crashed and burned recently, but that’s apparently not stopping them from buying more
On November - 21 - 2008
Someone, please take away their keys to the liquor cabinet: Citigroup's prospects continue to spiral into the abyss with its stock price in hat
size land and management blaming everyone else, like those evil short
sellers, and rumor mongerors for their ills. Some of their ugliest self inflicted wounds have come from failed forays into buying up hedge funds that have ended in disaster with the firm having to either bail them out or shutter them (including the disastrous buy of now CEO Vikram Pandit's Old Lane). Apparently Citi hasn't learned that it's not so good at these buys, since it's still buying:
Tags: Citigroup, Hedge funds, Toe Tags
Another one bites the dust: JO Hambro fund, a victim of the ill fated Volkswagen / Porsche trade, closing down
On November - 19 - 2008
One of the first funds to actually shut down over the disastrous hedge trade between Volkswagen and Porsche shares — that resulted in the mother of all short squeezes in Volkswagen stock — has emerged. The $240 million Trident European Fund, run by $3.5 billion JO Hambro, is liquidating after suffering a 25% loss in October. The fund, managed by Basil Postan, was down 39% for the year and had thrown off an average 8.4% annual return since opening 10 years ago.
Imploded hedge fund head John Devaney dissed at asset backed conference
On October - 26 - 2008
Ouch: John Devaney, the former billionaire baller and skipper of the imploded and liquidated Horizon Funds (and yacht "Positive Carry") didn't get such a great reception last Monday when he spoke at an annual conference for asset backed securities held in Miami. According to the NY Post, he was booed on stage during a "rant on why the markets were wrong and he was right". Later that evening he held an invitation only party on his mom's yacht (since his "Positive Carry" had been sold)…
Tags: Credit Crunch, Hedge funds, John Devaney, Liquidations / implosions, Toe Tags
Another Ospraie fund bites the dust after posting a 39% loss for the year so far
On September - 2 - 2008
Dwight Anderson’s largest hedge fund — the Ospraie Fund, with $2.8 billion in assets at the beginning of August — is closing its doors after suffering massive commodities related losses during the course of 2008. Year to date the fund was down 38.6% with most of the losses coming since July. The fund has been selling assets over the last three weeks and there’s been speculation that those sales have been a possible contributor to the recent fall in commoditiy prices.
The big fund’s demise could complicate fund raising efforts for beleagered Lehman Brothers. The firm owns 20% of the closing hedge fund’s manager, Ospraie Management.
Three remaining Ospraie funds manage over $4 billion in assets, but that’s down from $9 billion in March. According to Bloomberg:
The Ospraie Fund lost 26.7 percent in
August, after a “substantial sell-off in a number of our energy, mining and
resource equity holdings,” Anderson, 41, wrote in the letter today.“I am extremely disappointed with this result and the fund’s sudden reversal in
performance,” he said. “After nine years of striving to be a good steward of
your capital, I am very sorry for this outcome.”
Tags: Commodities, Hedge funds, Liquidations / implosions, Toe Tags
John Devaney liquidates his Horizon funds and investors get zero, zip, zilch, nada?
On July - 9 - 2008
Billion Dollar Wall Street Baller no more?: John Devaney, the flamboyant hedge fund manager and head of United Capital Markets Holdings who made massive wrong way sub-prime bets, was forced to liquidate his Horizon funds. And unfortunately, investors will be getting bupkus. Yep. A total zero.
Early this year, Devaney spoke at a conference where he said that it was time to start moving back into the sub-prime market. To keep his sinking empire afloat, he had been selling assets — including his prized yacht "Positive Carry", helicopters, a plane and a Renoir.
According to Bloomberg:
The Horizon group of funds run by Devaney’s
United Capital Markets Holdings Inc. couldn’t meet a margin call from Deutsche
Bank AG at the end of June, according to a letter to clients today obtained by
Bloomberg News. Deutsche Bank then seized and auctioned off the collateral.
Tags: Credit Crunch, Hedge funds, John Devaney, Liquidations / implosions, Toe Tags
Throwing in the towel: Citi is closing Vikram Pandit’s Old Lane fund
On June - 12 - 2008
Add another casualty to the list of dead hedge funds. Citigroup is putting the last nail in the coffin of Old Lane, the hedge fund it paid so handsomely (over $800 million) for to secure the services of the man who quickly rose to the position of Citi’s CEO — Vikram Pandit. At the time of its acquisition, now deposed CEO Chuck Prince had proclaimed the Old Lane acquisition to be "a unique opportunity to continue our growth in the highly competitive alternative investment area." So much for that.
Old Lane Partners has been dogged by
mediocre returns and the loss of top managers. Citigroup plans to shut it and
buy what is left of its assets, according to people familiar with the matter.Mr. Pandit personally reaped at least $165
million when Citigroup bought Old Lane in July 2007, following its founding the
previous year. At the time, many large banks and brokerages saw hedge funds as a
lucrative new business. Citigroup was also willing to pay a premium to land Mr.
Pandit, who quickly moved up the ladder and became chief executive in December.But as the fund struggled, Citigroup was
forced to choose between pumping new money into it or shutting it down. That
created an awkward situation for the new CEO. Mr. Pandit removed himself from
the deliberations to avoid the perception of a conflict of interest.
Wings clipped: EOS Airlines ceases operations and goes into bankruptcy
On April - 28 - 2008
All business class carrier EOS Airlines shuttered operations and filed Chapter 11 as it couldn’t scare up cash to continue operations. It had a deal to raise $50 million, or so it thought, but that fell through last Thursday….
The airline reconfigured Boeing 757s meant
for 220 passengers with 48 seats that could extend into a fully flat bed.
Flights served wine, champagne, cocktails and gourmet foods. There were
individual DVD players, and helicopter rides to the airport were offered to some
travelers.The price for the New York to London flights, which it offered twice a day,
ranged from $3,500 to $9,000 roundtrip.The high-flying luxuries came to an end Sunday as Purchase, N.Y.-based Eos
ceased operations after filing for bankruptcy protection, the latest casualty of
a credit crunch and a money-losing airline industry that has been hit hard by
high fuel prices.
Tags: Airlines, Bankruptcy, Credit Crunch, Toe Tags
Another one bites the dust: Carlyle Capital is finished as lenders move to seize assets
On March - 13 - 2008
It’s finally over for Carlyle Capital, Carlyle Group’s mortgage bond fund…..
Talks on a so-called standstill agreement
with lenders failed, Amsterdam-listed Carlyle Capital Corp. said in a statement
last night. Through March 12, the company has defaulted on about $16.6 billion
of debt, and any remaining debt is expected “soon” to go into default,
according to the statement.Carlyle Capital sought refinancing on its residential mortgage-backed
securities. Those negotiations failed late yesterday after a pricing service
used by some lenders reported a decrease in the value of its mortgage-back
assets, the firm said. Carlyle expects additional margin calls today of $97.5
million.“The basis on which lenders are willing to provide financing against the
company’s collateral has changed so substantially that a successful refinancing
is not possible,” Carlyle said in the statement.
Carlyle Capital Fails to Reach Accord; Lenders to Seize Assets - Bloomberg
Tags: Carlyle, Credit Crunch, Liquidations / implosions, Toe Tags
Peloton Partners is also liquidating its second fund and is shutting down
On March - 6 - 2008
Now it’s also pulling the plug on its second fund — the Multi-Strategy fund, and closing shop….
Tags: Credit Crunch, Hedge funds, Liquidations / implosions, Toe Tags
D.B. Zwirn shuttering two hedge funds suffering from internal control problems and large redemptions
On February - 22 - 2008
Hedge fund DB Zwirn is throwing in the towel on two funds, its on shore and off shore Special
Opportunities Funds, with $4.2 billion in assets after investors said they wanted to withdraw over two billion. The funds had disclosed accounting irregularities and internal control problems last year, including improper transfers between funds as well as improper handing of operational expenses. It’ll be an orderly wind down that could take years, not a fire sale according to a letter to investors. The company will still run around $1 billion of other assets not included in the two liquidating funds. According to the Financial Times:
On Thursday night, Zwirn sent a letter to
investors outlining its plans to liquidate assets, about 60 per cent of which
are not easily tradable and mostly involve illiquid loans made both in the US
and abroad.A spokesman for Zwirn confirmed that its
founder, Daniel Zwirn, had used a private jet but said he was not aware the
expense had been booked improperly to the funds. He added that all matters had
been remediated.Zwirn received a clean bill of health from
its auditors at PwC for 2006. But on January 29, PwC sent it a letter that
appeared to undermine that opinion, saying Zwirn’s failure to maintain proper
internal controls had led to “material weakness”. It cited areas of concern
including “improper cash and investment transfers, overcharging of expenses by
investment management to the fund” and “premature payment of management fees
to the investment manager”.
Tags: Hedge funds, Toe Tags
Bear Stearns shuttering a third fund…
On January - 10 - 2008
The Bear Stearns Asset Backed Securities fund was down only 39% last year….
Tags: Bear Stearns, Credit Crunch, Liquidations / implosions, Toe Tags
Game over for Absolute Capital
On November - 28 - 2007
Absolute Capital the latest credit crunch victim to go into bankruptcy….
Australian hedge fund Absolute Capital has
been put into administration, making it the country’s latest victim of the
credit squeeze, The Sydney Morning Herald reported Wednesday citing the
administrator McGrath Nicol.The hedge fund provider, which is 50 percent owned by ABN Amro (NYSE:ABN) ,
manages about 410 million Australian dollars for investors.McGrath Nicol was appointed after income was cut following Absolute’s major fee
generator, the Absolute Capital Yield Strategies Fund, being suspended after
suffering losses in structured credit markets, the newspaper said.Australian hedge fund Absolute Capital placed in administration – report – CNNMoney.com
Tags: Bankruptcy, Credit Crunch, Hedge funds, Toe Tags
Victor Niederhoffer’s bad luck continues; he’s liquidated his Matador Fund
On October - 10 - 2007
Break out another toe tag: Victor Niederhoffer’s Matador Fund Ltd was liquidated after experiencing losses of over 70% and the withdrawal of a major investor:
The roller-coaster career of maverick
trader Victor Niederhoffer took a sharp downturn after losses mounted and a key
investor withdrew money from his firm, demonstrating how the market’s recent
volatility has shaken even some veterans.Mr. Niederhoffer’s hedge-fund firm,
Manchester Trading LLC, ran into difficulties a decade after Mr. Niederhoffer
lost most of his personal savings when his previous hedge fund collapsed. Last
month, Mr. Niederhoffer’s largest hedge fund, Matador Fund Ltd., was liquidated
after suffering losses of more than 70%, according to people close to the
matter. Adding to Mr. Niederhoffer’s problems, according to a person close to
the firm: Swiss-based Octane, a fund-of-funds firm that invests in hedge funds,
pulled a significant amount of money from the firm.In recent years, Mr. Niederhoffer, 63 years old, had staged something
of a comeback, relying on a trading style that generally bets on rising
markets and quick trades and is characterized by wild swings. Last
year, for example, he saw the Matador Fund, based in Weston, Conn.,
lose 30% of its assets early in the year, but stage a rebound to finish
with gains by year’s end.Mr. Niederhoffer, known for quirks such as wearing colorful pants and
keeping the thermostat in his trading room set so high that his traders
dripped sweat over their computer terminals, continues to manage money
for himself, his family and his friends, according to a person close to
the matter.Veteran Trader Loses Investor, Closes a Fund – Wall Street Journal
Tags: Credit Crunch, Hedge funds, Toe Tags
Cilantro Fund mercifully youthanized by its 26 year old publicity ho manager, Timmy Sykes
On October - 1 - 2007
As expected, super self-promotional idiot trader Timmy Sykes has announced that he’s shutting down his itty bitty, funded with Bar Mitzvah shekels hedge fund. He took the opportunity of announcing that he was pulling the plug on the fund’s life support to simultaneously announce the launch of his new self-published book. Or is that a re-launch? He’s been relentlessly touting it since last July, so relaunch seems more appropriate. In any case, he provides an Amazon.com link not one, not two, but three times in his page long tribute to himself. (Thanks to the reader who sent this to us early today!) Here’s the first paragraph — we can’t stomach giving this pretender any more publicity than that:
Cilantro Fund Closing, Read All About It In
New BookToday, it is both with great sadness and joy that I am announcing the closing of
my hedge fund, Cilantro Fund Partners, LP and the official release of my debut
book An American Hedge Fund. Thanks to the success of my TV show, ‘Wall Street
Warriors’, I’ve been inundated with questions from people wanting to know more
about stock trading and hedge funds. I am sick and tired of how little the
general public knows about these subjects.. Some of you might not think this is
relevant to you, but you’re wrong. Whether you’re in finance or not, this is
about protecting our right to freedom of speech.
Gag. Next!
Tags: CNBC, Hedge funds, Toe Tags
BlueCrest shutters $550M Equity Fund
On September - 10 - 2007
BlueCrest Capital Management, a UK fund managing around $11 billion, is shutting down its Equity Fund due to months of poor performance. The market neutral fund, which targeted 12-15%/year returns, was down 8.2% through August….
Tags: Credit Crunch, Hedge funds, Toe Tags
Subprime meltdown du jour: Synapse closes one of its funds after backer pulls $$$
On September - 4 - 2007
Another day, another subprime meltdown related hedge fund victim:
In a brief note on its Web site yesterday,
London hedge-fund manager Synapse Investment Management LLP said it closed its
€200 million ($272.5 million) Synapse High Grade ABS Fund No. 1. German bank
SachsenLB, the fund’s main investor, asked for its money back in recent weeks
and triggered the closing, according to people familiar with the situation. A
SachsenLB spokesman wasn’t available for comment.Synapse said the fund, which had only been operating since April, was closed
"due to the severe illiquidity in the market," according to the
Synapse Web site. Liquidity is broadly defined as the ease with which an asset
can be bought or sold. Generally, mortgage-backed securities have seen their
values and willing buyers drop sharply in recent weeks."We’re disappointed," said Rob Ford, who managed the asset-backed
securities assets at Synapse. "The market is full of horrible
illiquidity."
The fund was set up last year by Graeme Anderson (in the picture at the top far left) and Mark Holman (top near left), both out of Barclays.
U.K.’s Synapse Closes Fund Weighed Down by Mortgages - Wall Street Journal
Synapse Shuts Fund Because of Market `Illiquidity’ – Bloomberg
Tags: Credit Crunch, Hedge funds, Toe Tags
The end: Basis Yield Alpha Fund files for bankruptcy
On August - 29 - 2007
After weeks of bad to worse news over subprime losses, Basis Capital pulled the plug on its Basis Yield Alpha Fund and put it into bankruptcy. Liquidation to follow. Creditors include JP Morgan, Goldman, Citigroup, Morgan Stanley, Lehman and Merrill, all of which had filed notices of default against Basis in June:
The Sydney-based firm’s fund asked a court
in the Cayman Islands for permission to liquidate its assets, according to a
petition filed in New York yesterday. The George Town, Grand Cayman-based fund
has assets and liabilities of more than $100 million, according to the petition,
which asked a federal bankruptcy judge to bar lawsuits in the U.S. while it
liquidates in the Caymans.Basis Yield Alpha has fewer than 49
creditors, according to the petition, which was filed under Chapter 15 of the
U.S. bankruptcy law. Using Chapter 15, a foreign-based company can win
protection from U.S. creditors while it liquidates or reorganizes overseas.Judge Robert Gerber in Manhattan will hear a request on Sept. 6. to temporarily
bar U.S. lawsuits while the company makes its case for permanent Chapter 15
protection. Today, Basis was granted a restraining order protecting it from
lawsuits until that hearing.
Basis Files for Bankruptcy Protection Over Subprime Losses – Bloomberg
Tags: Bankruptcy, Credit Crunch, Hedge funds, Toe Tags
So Long-o, Solengo? Brian Hunter’s new firm may close its doors without doing a trade
On August - 7 - 2007
In an eighteen page document filed in federal court in Washington DC on Friday, former Amaranth energy trader and Solengo Capital founder Brian Hunter disclosed that his firm may already be close to toast. Given all of the litigation filed against Hunter, two directors of his new venture have resigned and investor interest has evaporated:
According to Hunter, as a direct result of
FERC’s order to show cause filed two weeks ago, Solengo has lost fund
directors, investment staff and potential investors, and he has seen two other
business deals go down the tubes.“The FERC’s OSC has continued to damage Solengo Capital Advisors and the
company is now on the brink of complete disintegration,” he wrote in the
supplemental declaration, filed on Friday.Hunter, of course, also faces a Commodity Futures Trading Commission enforcement
action for attempted market manipulation, but he argues that the CFTC action is
small potatoes—survivable, while the order from FERC, whose jurisdiction he
rejects anyway, is potentially fatal.
Tags: Amaranth, Brian Hunter, Hedge funds, Legal, Toe Tags
