It will probably not come as a shock to most that the hedge fund that was co-founded by Bart McDade – who was president and COO at Lehman when it filed for bankruptcy in September 2008 largely as a result of its massively underwater and mispriced CMBS investments – and Alex Kirk, who was Lehman’s global head of principal investments, is shutting down.
According to Bloomberg, River Birch Capital, the credit fund run by “prominent executives” from Lehman Brothers plans to shutter after suffering client withdrawals.
River Birch is, or rather was, a credit-focused hedge fund that made long and short bets in bonds, structured debt and derivatives; in short it was a mini Lehman, and with history rhyming, it suffered a similar fate. The money manager said it invests in assets ranging from investment-grade credit to distressed debt.
Last year River Birch was a creditor to bankrupt retailer Toys “R” Us Inc. in the U.S., while in Europe earlier this year it was part of a group lobbying Portugal to make good on impaired bonds from a bailed-out bank
As Bloomberg notes, the hedge fund is returning client capital after losing a key investor, said the people, who asked not to be identified discussing a private matter. As of March, River Birch managed about $1.7 billion, including leverage.
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