Hedge Funds

Severn River limiting redemptions


Scott Roth's Severn River has partially activated its redemption gate in an apparent effort to balance the interests of its existing and departing investors as it transforms itself from a multistrategy fund to a tightly-focused event-driven fund.

The Greenwich, Conn. fund's terms call for a 10% quarterly redemption limit, meaning that Severn, which held $560 million in August, could limit its quarterly redemptions to $60 million. The gate expires after one year, meaning that all capital requested to be redeemed must be returned after one year.

But after recently receiving redemption requests of $260 million, Severn sought to