Wednesday, 26 October 2016
Last updated 11 hours ago
Aug 11 2011 | 11:28am ET
Centaurus Capital has returned as much as $1 billion to its investors and slashed its fees in the wake of its first-ever down year.
The Houston-based firm told investors in May that it would return between 10% and 20% of its $5 billion in assets amidst a paucity of opportunities. The money was to be paid out on June 1, allowing Centaurus to "maintain an aggressive risk/return portfolio," firm founder John Arnold wrote.
"While the U.S. natural gas market continues to grow in volume, when measured in dollars, it has shrunk significantly over the past few years as a result of persistently low prices," he complained.
Arnold also announced a significant fee cut: Management fees cut in half from 3% to 1.5% and performance fees reduced to 30% from 35%. But those carrots are at the end of a fairly unpalatable stick: Investors who stayed with Centaurus after June 1 had to accept a new one-year lockup of their assets.
It is unclear how many investors chose to redeem their capital instead of acceding to the new lockup.
Centaurus' moves were first reported by Opalesque.
Centaurus lost 4% last year, it's first-ever annual loss. The firm, founded in 2002, had returned 30% in 2009.