By Britt Erica Tunick
Illustration by Graham Roumieu
New York hedge fund firm Claren Road Asset Management has attracted numerous suitors in its relatively short life. The $4.7 billion long/short credit firm reportedly got started with a $250 million seed investment from Citigroup in 2005. Then Goldman Sachs’ Petershill Fund, a private equity vehicle designed to take stakes in hedge funds, bought a minority position in the firm in 2008. The latest firm to take a shine to Claren Road is the Carlyle Group, which acquired 55% of the firm, effectively buying out Citigroup and Goldman, which will cash out their investments.
This is not Carlyle’s first trip down the aisle with a hedge fund, but will the firm do any better with Claren Road than with its previous efforts? After all, the Carlyle-Blue Wave Partners Management hedge fund was liquidated in August 2008, only 16 months after...