Satellite Asset Management is using an unusually short-lived vehicle to take advantage of exaggerated pricing inefficiencies in the equities of companies involved in recently announced leveraged buyout deals. The fund opened in August with roughly $200 million and will liquidate on December 31.
This short-lived fund, the first of its kind at Satellite, aims to exploit abnormally wide pricing spreads on several recent deals. The fund charges fees of 1.5% of assets and 20% of performance and will not redeem investors until the fund's December 31 expiration.
Spreads between the equity price of LBO targets and the price