Hedge fund firm Magnetar cuts London jobs(Zz)

From:
http://www.reuters.com/article/innovationNews/idUSTRE50I4DW20090119

Hedge fund firm Magnetar cuts London jobs

Mon Jan 19, 2009 1:12pm ES

LONDON (Reuters) - Multibillion dollar hedge fund firm Magnetar Capital has shut its London risk arbitrage desk and cut seven jobs, the firm told Reuters on Monday, as the industry goes through its biggest crisis.

A spokesman said four traders and three support staff had left the 15-person London office of Magnetar, which runs multi-strategy hedge funds.

"There's been an appropriate reduction in the office to reflect the decision of the firm not currently to do risk arbitrage out of its London office," the spokesman said.

"Other than that, the firm supports all the strategies it's been engaged in London."

Last year Magnetar put up gates, which limit investor redemptions, on its multi-strategy funds.

Many other hedge funds took similar measures as returns plummeted and investors sought to redirect cash to safer havens.

Magnetar was founded in 2005 and has affiliate offices in New York, Philadelphia, London and Beijing, according to its website.

In the past year Magnetar fund has taken positions on a number of UK-listed takeover targets including oil company Imperial Energy (IEC.L), brewer Scottish & Newcastle and British kitchen equipment maker Enodis Plc, according to regulatory filings.

This strategy, known as merger arbitrage, whereby funds bet on whether a deal will be sealed or not, is common among hedge funds.

(Reporting by Laurence Fletcher, editing by Will Waterman)