Earthtimes – NEW YORK: Hedge fund Amaranth Advisors LLC informed investors its two main funds fell by as much as 50 per cent in September because of the decline in natural gas prices. The firm is selling a major portion of its European loan portfolio to cover the losses.
Nick Maounis, founder of the Greenwich, Connecticut-based fund, said the firm is in discussions with its brokers and other counterparties and is working to protect its investors while meeting the obligations of its creditors.
The firm plans to sell up to two billion euros of European syndicated loans in the London-based secondary loan market as part of its effort to raise cash to meet redemptions on its funds. It is also said to be planning to sell other securities including convertible bonds.
Amaranth, which has nearly $9.5 billion in capital under its management, said its year-to-date losses could top 35 per cent as it liquidates its natural gas exposure. The funds had been showing a 30 per cent profit prior to the sudden swing in the price of gas last week — a fall of as much as 12 per cent. Prices have been generally falling since December 2005.
