New York (HedgeCo.Net) – Two hedge funds run by famed portfolio manager Jeffrey Gendell are being closed because of heavy losses suffered this year.  Both Tontine Partners LP and Tontine Capital Partners LP are liquidating assets, although no time table has been given.

The Greenwich-based Tontine Associates, which manages over $11 billion through their four hedge funds, reached their decision after the two funds lost more than two-thirds of their value this year.  Tontine Partners was down 65 percent for the year through September September 30^th, while Tontine Capital Partners plunged over 75 percent.

“The combination of falling commodity prices, massive anticipated hedge-fund redemptions and the seizing up of the credit markets caused an enormous dislocation in our portfolios,” Gendell told clients last month.

The hedge funds will be liquidated in an orderly fashion, in order to maximize shareholder returns.

Tontine Associates will continue to offer two other hedge funds; the Tontine Financial Partners LP and the Tontine-25 Fund, both run by Gendell.  Before the recent credit crisis, all of the firm’s hedge funds were posting admirable returns of almost 40 percent annually since inception.

Hedge funds as a whole have not been faring too well as of late, with research by Hedge Fund Index showing losses of over 15 percent overall this year.  The Tontine hedge funds are just the latest in a string of closures stemming from massive hits.  Big names like Drake Management, Highland Capital and Ospraie have all closed funds this year. 

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

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West Palm Beach (HedgeCo.net) - In a Reglatory filing with the SEC, multibillion-dollar hedge fund, Tontine Associates, has bought 5% of trucking giant YRC, equaling 2.97 million shares of YRC common stock, for more than $48 million.

Jeffrey Gendell, founder of Tontine Associates, has made big investments recently in other struggling companies in the region. Earlier this year, he spent more than $11 million to acquire an 8.6 percent stake in Thermadyne Holdings Corp., a struggling producer of metal-cutting and welding equipment based in Chesterfield, Mo.

Gendell also bought more than 400,000 shares of TierOne Corp., a Lincoln, Neb., bank that has lost nearly $100 million in the past four quarters.

Stockpickr.com reports “Gendell’s specialty is picking a macro-styled theme, buying very large positions in companies that benefit from that theme, and then working with or pressuring management to improve shareholder returns”.

Gendell, among other things, is a donor to Duke University and a part-owner of the Cincinnati Reds baseball team.

Editing by Alex Akesson

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