Atticus to Close Two Funds, Return $3 Billion to Investors
Atticus Capital, one of the most successful hedge funds in the past decade, will close two of its three funds and give back $3 billion to investors by the end of the year, CNBC has learned.
It will close its flagship fund, Atticus Global, which lost 25 percent in 2008 and has fallen 6 percent so far this year. It will also close one of its smaller operations, causing at least one-third of its US employees to leave the company.
It will continue to operate its $1.2 billion Atticus European Fund.
In a letter to investors, Atticus officials said they are not closing the funds due to investors retracting their money.
"After 15 years of being singularly focused on building and managing Atticus, I believe it is time to reassess my future," Atticus founder Timothy Barakett wrote.
He said he would pursue philanthropic interests, establish a family office and form a charitable foundation.
Barakett said the market's recent rally let him begin liquidating "a significant amount of our holdings" and that he expects the Atticus Global portfolio will be fully liquidated by Sept. 30.
About 95 percent of the fund's capital will be returned by early October, with the remainder coming back after a final audit later this year.
Atticus joins a growing list of hedge fund managers shutting down after last year's turbulent markets hammered performance and spurred investors to withdraw their money. Famed for activist campaigns targeting companies such as Deutsche Boerse, Atticus managed close to $20 billion by the end of 2007.
Yet Barakett's aggressive, lightly hedged investment strategy led to losses in the past year.
Over the lifetime of the fund, though, Atticus Global on average climbed 19 percent a year, after fees, outpacing the 3.9 percent increase in the Standard & Poor's 500, Barakett told his investors.
Atticus was formed in 1995 and launched its first fund in 1996 with just $6 million.
—Reuters contributed to this report