Hedge Funds

Steyer's Farallon moves to restructure on big losses

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Loss-ridden Farallon Capital Management plans to split its flagship in two and lower its fees to keep investors placated following redemption requests that have "substantially" exceeded its gate of 15%. Like Marathon, Farallon has the cash to meet redemptions but isn't choosing to do so.

The long-biased Farallon Capital Offshore Investors has lost roughly one-third of its value this year through November, in part because of bank debt bought in late 2007 and early 2008.

Tom Steyer's Farallon, which was the sixth-largest hedge fund in July, told investors in a November 28 letter that it wanted to split the fund