Sandell reorganizes Castlerigg funds, threatening a lockup but offering to cut fees

Mon Nov 17, 2008




Tom Sandell’s Sandell Asset Management is the latest firm to impose a lockup on investors – without calling it that, of course. Investors in the firm’s Castlerigg Master Investments and its flagship Castlerigg International, which was down 24.23% through October, were informed last Friday that if they do not adopt a reorganization plan proposed by the firm, Sandell will suspend all redemptions and indefinitely lock up their money anyway. Those who agree to stay, however, will get a break on fees, as will any new investors.
 
In a November 14 letter to investors, the firm said that prolonged market difficulties and the resulting liquidity drain have led to a large number of redemption requests for December 31.

"Fear that certain other funds will invoke constraints has led to the unfortunate self-fulfilling prophecy of redemptions being substantially larger than they might ordinarily have been as investors have sought to...

ISSN: 2151-1845 / CDC10004H

TAKE A FREE TRIAL

The full contents of this article are available to active AR subscribers and trialists only.

To continue reading please,
take a free trialsubscribe or log in to AR.

Subscribe

Subscribers have unlimited access to all current and archive content. Start your subscription today - click on the button below.

Subscribe now