Friday, 31 October 2014
Last updated 2 hours ago
Oct 5 2012 | 2:08pm ET
Avenue Capital Group is growing and shrinking.
The New York-based hedge fund will lay off 16 people following a review by a consulting firm. Two of the terminated are members of the investment team, while the rest come from its back-office and administrative staff.
But Avenue is also adding a business line, direct lending, and the hedge fund said it was likely to make hires in other areas, Reuters reports.
"Earlier this year we retained a consulting firm to conduct a review that was recently completed," firm founders Marc Lasry and Sonia Gardner wrote. "One outcome of this process is that we are reducing Avenue's global workforce by approximately 6.5%."
The founders also said Avenue would become the latest hedge fund to try to profit from banks' increasing reluctance to offer financing to smaller companies.
"We have recently added a senior member to the Avenue team to establish a direct-lending business and expect to bring on additional professionals as this new business scales up," they wrote.
Lasry and Gardner added that Avenue has bounced back from a double-digit loss last year with "double-digit returns" this year.
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