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
"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...