Lee Sustains Losses, May Shut Down Two Hedge Funds

New York (HedgeCo.Net) – Hedge fund investor Thomas H. Lee may downsize or shut the door to two of his funds after posting losses of about 40 percent this year, according to the Wall Street Journal.

The funds, which together manage about $1.5 billion, suffered losses that were multiplied by Lee’s heavy use of leverage, according to the sources who estimated he sustained losses of as much as $3.2 billion.

The funds were actually set up as funds-of funds, meaning Lee distributed investor’s money to approximately 110 other funds.  When investors moved to withdraw cash from the hedge fund, it sparked a wave of redemption requests from the original funds, creating a domino effect of losses.   

Funds that Lee invested in include SAC Capital Advisors and D.E. Shaw Group, according to the report.

Lee’s private equity firm was launched in 1974 and has grown to be one of the largest in the country.  Lee now heads up his hedge fund business, Thomas H. Lee Capital Management LLC and his new private equity firm, Lee Equity Partners.  Lee currently manages about $2.7 billion in capital.

Julie Scuderi
Senior Editor for HedgeCo.Net
Email: julie@hedgeco.net

HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds!
Be sure to check out our sister sites. www.hedgefundlounge.com, www.hedgefundtools.com, and www.hedgefundemployment.com

 

About the HedgeCo News Team

The Hedge Fund News Team stays on top of breaking news in the Hedge Fund industry on an hourly basis. Signup to HedgeCo.Net to recieve Daily or Weekly news updates from our team.
This entry was posted in HedgeCo News and tagged , , , , , , , , , , , , , . Bookmark the permalink.

Comments are closed.