Citigroup closes down Old Lane

June 12th, 2008
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Citigroup is closing Old Lane Partners, a hedge fund co-founded by Citigroup's current CEO Vikram Pandit. Old Lane has been struggling with the management losses as well as unsatisfactory returns. Citigroup will liquidate holdings in Old Lane's portfolios and transfer a few portfolios to its investment bank or alternative-investments group. Citigroup bought the hedge fund in July 2007 for more than $800M, not only wanting to get in on the hedge fund business, but also willing to pay a premium for Mr. Pandit. However, after Old Lane's top management moved to jobs at Citigroup, many of the large investors in the fund from its beginning withdrew their money. Old Lane is only the latest hedge fund-related problem for banks. Bear Stearns, Goldman Sachs, and UBS have also lost billions for themselves or their clients in hedge funds during the credit crunch.
Related Article Tags: Hedge Fund Launches and Hedge Fund Closings

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