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Reuters – Warren Lichtenstein’s Steel Partners LLC is forging ahead with a controversial plan to convert its flagship hedge fund, Steel Partners II, into a publicly traded holding company in the face of opposition from shareholders calling for liquidation.
The New York-based firm told limited partners, in a shareholder letter dated Tuesday, that they have until June 5 to either approve its plan to convert the fund into shares in a listed company, Steel Partners Holdings, or elect to receive a share of the fund’s assets. Both options will also distribute some cash.
Reuters – Warren Lichtenstein’s Steel Partners LLC is forging ahead with a controversial plan to convert its flagship hedge fund, Steel Partners II, into a publicly traded holding company in the face of opposition from shareholders calling for liquidation.
The New York-based firm told limited partners, in a shareholder letter dated Tuesday, that they have until June 5 to either approve its plan to convert the fund into shares in a listed company, Steel Partners Holdings, or elect to receive a share of the fund’s assets. Both options will also distribute some cash.
"For myself and many of our investors, the option provided by Steel Partners Holdings is too compelling to ignore," Lichtenstein said in his investor letter, a copy of which was obtained by Reuters.
Bloomberg – Activist investor Warren Lichtenstein is seeking to convert his largest hedge fund into a publicly traded partnership after clients sought to withdraw 38 percent of their money.
The $1.2 billion Steel Partners II Fund lost 39 percent last year and froze redemptions in December, according to a presentation to investors last week. Lichtenstein is asking investors to approve a plan to merge the fund with WebFinancial LP, a publicly traded partnership it already controls. The move will allow withdrawals to resume without forcing the fund to liquidate assets.
“The WebFinancial structure achieves our objectives of providing liquidity to those that want it, while maximizing value for all our investors,” New York-based Steel Partners LLC said in a statement. If the conversion is approved, the firm expects investors to be able to begin selling WebFinancial units by June.
