Bloomberg – Citadel Investment Group LLC, the hedge-fund manager founded by Kenneth Griffin, said earnings by its two largest funds increased more than fivefold on gains from debt and energyinvestments.
Net income at Citadel Kensington Global Strategies Fund Ltd. rose to $795.6 million in the first eight months of 2006 from $148.4 million in the year-earlier period, the Chicago-based firm told investors this week in a prospectus for its first bond sale. The fund, which has $9.5 billion in assets, returned 7 percent in the third quarter, compared with 3.1 percent a year earlier, when its corporate-debt and energy bets lost money.
“Citadel hired a significant number of new investment professional since mid-2005 to strengthen both the global credit and global energy business,” the Nov. 27 document said. Earnings at its Wellington LLC fund, which has $3.3 billion in assets, rose to $389.1 million from $54.3 million.
The 363-page prospectus, a copy of which was obtained by Bloomberg News, details the finances of the closely held firm, which oversees almost $13 billion for wealthy investors and institutions. Hedge funds, private pools of capital that allow managers to participate substantially in their investment gains, oversee $1.3 trillion, more than double the industry’s assets five years ago.
Institutions such as pension funds and endowments have contributed about $361 billion to hedge funds, according to an Oct. 10 report by Bank of New York Co. and consulting firm Casey, Quirk & Associates LLC in Darien, Connecticut. That amount may triple by 2010.
