Hedge Funds Performance

Illiquids, redemptions bedevil Stark's purchase of Deephaven.

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Stark Investments' agreement to purchase the assets of the troubled Deephaven Capital Management on the cheap - for an initial $7.3 million - was seen as a strategic triumph when the deal was announced in late January. After all, the agreement gave the $8.5 billion Stark the right to manage Deephaven's funds (as well as ownership of most of the physical assets of the investment management firm).

Tactically, however, the deal has been challenging to implement as both Deephaven and Stark investors voiced concern over differences in the firms' valuation policies and worried about the sizable portion of