Fortress to Close Centaurus Global Unit as Repositioning Continues

Jul 28 2016 | 10:13pm ET

Hedge fund manager Fortress Investment Group will shutter its Centaurus Global hedge funds as the firm’s strategic repositioning away from liquid strategies continues. 

The Centaurus unit, managed by CIO Randy Freeman, came aboard Fortress’s liquid markets business in May 2014. It focuses on global, equity-biased event driven opportunities driven by catalysts in liquid securities across the capital structure, according to Fortress, and managed $182 million as of June 30. 

The move was disclosed in Fortress’s second-quarter results. It is the latest in a series of steps undertaken by Fortress since last year to increase its focus on more illiquid strategies and rationalize what it terms an “underperforming liquid markets segment.”

In October 2015, the company closed its well-known Macro fund, managed by Michael Novogratz, and transferred its interests in its Convex Asia unit to Singapore-based City Financial Investment Company in April.

The Centaurus unit has been under pressure lately. It lost 6.1% in the second quarter of this year, according to Reuters, and is down 4.9% for the year to date through the end of June. Assets have declined as well, falling from $222 million as of last September. 

Details surrounding the closure, such as return of capital and whether the Centaurus team will continue at Fortress in other capacities, were not immediately available. Centaurus was founded by Freeman and Bernard Oppetit in 2000.

Founded in 1998, Fortress manages more than $70 billion across a number of alternative investment strategies as of June 30, 2015. It was the first private equity and hedge fund manager to sell shares to the public when it IPO’d in February 2007 at $18.50. 

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