LONDON (Reuters) - Hedge fund firm City Financial has agreed to transfer two funds, which run a total of $332 million in assets, to Garraway Capital Management, a source familiar with the matter told Reuters on Monday.
City Financial had completed a restructuring of its business in December, including closing its New York office.
Reuters had reported in December that City Financial and the chief investment officer of its Decca Fund had decided to wind down its credit-focused strategy. After Decca’s closure and the restructuring, City Financial’s assets dropped to $1.2 billion in December, from $3.3 billion 12 months earlier.
On February 22, City Financial filed a notice to appoint an administrator in which the firm’s CEO Rob Hain said the firm “is or is likely to become unable to pay its debts”.
City Financial renewed the notice on March 8 for a further ten business days while it looked for a “positive solution”, the source said.
Garraway will take over City Financial’s Absolute Equity Fund in Britain, managed by David Crawford and Ade Roberts, and the multi-asset fund in the UK and Ireland, managed by Mark Harris, the source said.
Garraway did not respond to requests for comment.
The transaction is subject to contract and regulatory approval, the source said.
Reporting by Maiya Keidan. Editing by Rachel Armstrong and Jane Merriman