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    • Why Investment Banks Should Not Buy Hedge Funds [view article]
      As a former an investor in Old Lane I can tell you without a doubt that many of your assumptions are incorrect. Yes, Citi overpaid. Is it a bad deal? Too early to know. Citi essentially 'sacrificed' Old Lane when they purchased the fund. They knew investors would end up redeeming. In fact, Old Lane twice offered investors the ability to redeem immediately regardless of their lock-up or liquidity. They expected the redemtions. I will also tell you that much of Citi's new equity capital has come from former Old Lane investors that Pandit and Havens knew well. When viewed through this lens is the deal still a failure.

      As an Old Lane investor (by the way, there were probably less than 20 non-affiliated LP's...mostly very large checks) I felt slightly betrayed. We signed up to invest with the very talented team that was forced out of Morgan. Yes, the early results were marginal, which only cements my disappointment. However, the fact remains, most of the pundits making comments about the Old Lane transaction butcher the facts and make flawed assumptions about the people, intent, size and state of the Old Lane business, and events subsequent to the acquisition.       May 07 08:53 AM
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