Longacre Pulls Plug On Flagships

Oct 11 2011 | 2:49pm ET

Longacre Fund Management is closing its largest hedge funds and preparing for a much smaller future.

The New York-based firm told investors yesterday that it would shutter its main funds in the wake of larger-than-expected redemptions. Clients apparently headed for the door as the firm lost 7% in August, wiping out its year-to-date gains.

Longacre was already in much-reduced circumstances by the beginning of the year, having seen its assets drop from a peak of about $3 billion to just $835 million. Late last year, the firm closed its office in London.

Longacre, a distressed specialist, had been seeking strategic partners to keep it afloat; the firm sold a minority stake to Goldman Sachs' Petershill private equity fund three years ago. It will continue to manage several smaller funds, offering clients the opportunity to transfer their investments in its larger funds to the surviving funds. But Longacre said that it will shrink significantly one way or the other, The Wall Street Journal reports.

Longacre was founded in 1998 by three Bear Stearns distressed debt traders, John Brecker, Vladimir Jelisavcic and Steven Weissman. The firm's flagships have managed positive returns in all but two years since then, and have annualized returns of 9.6% and 9.8%.


In Depth

Q&A: Sancus Capital And The Disruption Of The CLO Market

Oct 5 2017 | 6:28pm ET

Traditional collateralized loan obligation (CLO) funds in the U.S. market can offer...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Finding Success as Alternatives Converge

Oct 9 2017 | 4:00pm ET

Rising interest among institutional investors over the past several years has led...

 

From the current issue of