Tontine Raises $12 Million For New Hedge Fund

May 29 2009 | 11:57am ET

Jeffrey Gendell is laying the groundwork for his comeback, with his Tontine Partners raising money for a new hedge fund.

The Greenwich, Conn.-based firm has raised $11 million for its new Tontine Total Return Fund, as well as $1.6 million for an offshore version of the new vehicle, according to a Securities and Exchange Commission filing. Gendell launched the fund in February, three months after telling investors he would shutter the firm’s flagship hedge funds. The new fund does not use leverage.

Tontine, which less than a year ago managed $11 billion, decided to close its Tontine Capital Partners and Tontine Partners hedge funds amidst massive losses. The former had shed 76.8% through October, and the latter 67% through September. Based on its holdings report, Tontine seems to have liquidated most of those funds; as of the end of September, the firm had $6.5 billion in equity positions, as of the end of March, it had just $577.2 million in stock holdings.

In addition to the new Total Return Fund, Tontine continues to manages its Tontine Financial Partners and Tontine-25 Fund. Neither of the surviving funds did especially well, with the former dropped more than 50% and the latter more than 80% through October.


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