Tiger Asia Management will return investors' money and become a family office as it faces insider-trading investigations on both sides of the Pacific.
The $1.2 billion New York-based hedge fund cited those probes as the reason for closing to outside investors. Firm founder Bill Hwang, who set up Tiger Asia in 2001 after a successful run at Julian Robertson's Tiger Management, said that most of the firm's employees will remain with the family office, although several analysts will found their own Asia-focused hedge fund.
"I am writing to let you know that after much consideration, and due largely to a prolonged legal situation, I have decided to return outside capital to investors effective at the end of the month," Hwang wrote on Sunday. "We continue to work to resolve these matters in the U.S. and overseas and look forward to putting them behind us."
Hong Kong's Securities and Futures Commission accused the hedge fund, which has no physical presence in the city, in 2009 of making illegal trades in two Chinese banks. The two sides have been battling ever since, with the most recent courtroom victory going to the SFC in February, when an appeals court ruled that the regulator can seek to have the hedge fund and its principals barred from trading and to have its assets frozen.
The U.S. Securities and Exchange Commission has also gotten into the game, subpoenaing Tiger Asia in October 2010.
Tiger Asia has produced annualized returns of 15.8% since its debut at the beginning of 2001.