New York (HedgeCo.Net) – The private equity firm Carlyle Group will liquidate its lone hedge fund, after stating that it failed to achieve “critical mass.”

The fund, Carlyle-Blue Wave Partners Management LP, was a multi-strat fund launched by Rick Goldsmith and Ralph Reynolds.  The two managers previously served as co-heads of global equity derivatives at Deutsche Bank.

"This is an orderly liquidation to ensure fair and equitable treatment of all investors," said Carlyle spokesman Chris Ullman.

The fund was among many to suffer losses fueled by the credit crisis that starting brewing last summer.  After posting losses in 2007, the fund looked to be turning around and  even showed gains of 2 percent in 2008.  However, Carlyle said they could not keep up with the cost associated with staff and infrastructure and decided to go forth with the liquidation. 

According to a statement published on the company’s website, the fund was "launched in a challenging market and [has not] been able to achieve the critical mass of assets under management necessary to support a multi-strategy fund infrastructure."

Assets under management are now estimated at $600 million, $300 million less than its peak. 

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

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