(Bloomberg) — The firm is closing funds that invest in equities, emerging markets, commodities, as well as a fund that focuses on Europe, Middle East and Africa, James Gruver, a spokesman for Black River, said Thursday. The hedge funds account for about 15 percent of Black Rivers assets, he said.
The closures at Black River, which was started in 2003 and is run by Gary Jarrett, adds to a roster of hedge funds that have liquidated, some after struggling to navigate markets. Armajaro Asset Management plans to close its $450 million commodities fund after losing money, a person with knowledge of the matter said this week. Fortress Investment Group LLC is shrinking its macro business to help turn around performance thats struggled since the start of 2014.
Since it was founded 150 years ago, Cargill has expanded beyond its original business of grain trading to encompass the buying and selling of energy and the production of meat and poultry. The largest closely held company in the U.S., with 152,000 employees worldwide, Cargill also owns asset manager CarVal Investors.
Black River was formed from Cargills capital markets group and was named after a river in Wisconsin where Cargill invested in a logging company in the late 1880s.
Returning Money
Black Rivers largest hedge fund, the $1.8 billion Fixed Income Relative Value Opportunity Fund, will continue to operate, as will its emerging markets credit strategies, which has $500 million, Gruver said. The firms private equity group, which oversees about $2 billion, wont be affected, Gruver said.
Black Rivers commodity fund is down 0.7 percent in the first half and its EMEA Investors Fund has gained 13 percent, according to an investor update. Its emerging markets fund has gained 7.4 percent while the equity fund is up 3 percent.
The firm will be returning money to investors in the coming months, Gruver said. He said the decision to close the four funds was made because of a lack of investor demand. He declined to comment on potential layoffs.
–With assistance from Isis Almeida and Javier Blas in London and Nathaniel E. Baker and Simon Casey in New York.
