Compelo Banking is using cookies

We use them to give you the best experience. If you continue using our website, we'll assume that you are happy to receive all cookies on this website.

ContinueLearn More
Close
Dismiss

Cerberus To Introduce Three-year Lock-up Period For Two Hedge Funds

The company also to stay away from high-profile takeovers for some time

In an attempt to prevent the recurrence of the huge outflows following the purchases of Chrysler and GMAC, Cerberus, the US-based private equity investment group, is introducing a three-year lock-up period to bar investors to withdraw money in two new hedge funds – reported Financial Times.

It has been reported that the two multibillion-dollar funds, Cerberus Partners II and Cerberus International II, are successors to two vehicles that were hit $500 billion in redemptions over the past year, as Cerberus’s high-profile investments soured due to financial crisis.

Officials at Cerberus told the newspaper that the latest move reflects the company’s intension to avoid a similar kind of situation they encountered in December 2008, when it unilaterally stoped redemption requests from the two hedge funds to prevent a fire sale of its assets. Mark Neporent, chief operating officer, said that Cerberus’ portfolio, excluding the two funds, had recorded an 18% return so far this year and the two hedge funds were up between 1.5 and 3% this year, reported the newspaper.