Wednesday, 27 July 2016
Last updated 4 hours ago
Feb 3 2014 | 4:02pm ET
Exis Capital Management will shut its hedge funds and return capital to investors, closing its doors a year-and-a-half after the end of a six-year legal fight that firm founder Adam Sender said caused "immense" damage.
The New York-based firm's assets, which once topped $1 billion, had dwindled to just $75 million by the end of last year. Exis also suffered a losing year in 2013, dropping 5.1% as the stock market soared.
Exis had not notified investors of its plans as of yesterday, according to The Wall Street Journal, which first reported the closure. Sender's full plans are unclear: Some Exis employees will be retained, and it remains to be seen whether he plans to shut the firm outright.
Exis, along with fellow hedge funds Kynikos Associates, SAC Capital Advisors and Third Point, was sued in 2006 by Canadian insurer Fairfax Financial Holdings, which alleged that the firms, along with brokerage Morgan Keegan, conspired to drive down Fairfax's share price. Exis was the last hedge fund defendant in that case, which was finally dismissed by a New Jersey judge in 2012.
The year before, Sender complained that Exis had been unable "to raise any significant capital since Fairfax of Canada sued us in 2006." He called the $8 billion racketeering lawsuit "completely frivolous, and a complete fantasy."
It may have been, but the suit did see several profane e-mails between Sender and Third Point's Daniel Loeb made public.
Sender founded Exis after a stint at SAC Capital Advisors, which is also closing its doors. The firm posted annualized returns of 16.4% over its run, which features only three down years since its founding in 1998.
The move to close Exis' hedge fund comes after Sender pledged to "reestablish Exis Capital as one of the leading hedge funds in the world" following the Fairfax dismissal.