Citadel to buy $ 500 million from Melvin Capital – .

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Citadel to buy $ 500 million from Melvin Capital – .


Citadel, which is based in Chicago, and Point72 Asset Management – a Stamford, Connecticut-based fund where Melvin founder Gabriel Plotkin previously worked – intervened with $ 2.75 billion in cash on January 25. . The injections helped. stabilize Melvin, which has generated double-digit returns since Feb. 1, according to one of the people, who was briefed on his performance.

Melvin is still down 41% for this year through July, according to an investor letter reviewed by The New York Times, due to his heavy losses from January.

As part of its investment, Citadel perceives a reduction in Melvin’s income, in addition to the return on his money, the two said. Citadel has also been granted the right to withdraw at least some of its cash as early as the third quarter of this year, the people added – a right it now exercises. (Hedge fund investors are generally required to leave their capital invested for a longer period.) Citadel, which manages $ 38 billion in assets, is itself up about 9% through the middle. August, according to one of the people, who had been briefed on the company’s performance.

Mr. Plotkin declined to comment. Kenneth C. Griffin, founder of Citadel, did not respond to requests for comment.

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