Citigroup Inc. is closing a hedge fund co-founded by Chief Executive Vikram Pandit, 11 months after Citigroup bought the fund’s management company for more than $800 million.
Old Lane Partners has been dogged by mediocre returns and the loss of top managers. Citigroup plans to shut it and buy what is left of its assets, according to people familiar with the matter.
Mr. Pandit personally reaped at least $165 million when Citigroup bought Old Lane in July 2007, following its founding the previous year. At the time, many large banks and brokerages saw hedge funds as a lucrative new business. Citigroup was also willing to pay a premium to land Mr. Pandit, who quickly moved up the ladder and became chief executive in December.
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