New York Times – Ritchie Capital Management, a $2.8 billion hedge fund based in Geneva, Ill., is close to an agreement to sell the assets in its flagship multi-strategy fund for about $1 billion,said a person briefed on the negotiations. Ritchie would continue to manage the assets.
The deal comes after a year of turmoil for the fund. Two months ago, management presented a restructuring plan to investors in an effort to stave off mass redemptions resulting from poor performance, regulatory investigations and concerns about the value of some of the funds’ holdings. Investors approved the plan, which has now been nullified by the potential sale.
Ritchie was founded in 1997 by A. R. Thane Ritchie, a star tight end and linebacker in college football who nearly made it in the pros. The fund uses a variety of strategies, including investing in small loans to risky companies, reinsurance, private equity and stocks.
Ritchie’s zigzagging performance comes at a time when many multi-strategy hedge funds, buoyed by a year-end rally in stocks, are posting strong returns. The relative value arbitrage index  a benchmark often used to examine multi-strategy funds  returned 10.81 percent through November, according to Hedge Fund Research.
