Aug. 25 (Bloomberg) -- Ken Griffin, founder of the $11 billion hedge fund Citadel LLC, is firing the last of the sales people and traders in his securities business as it focuses on electronic trading, according to two people briefed on the dismissals.
The firings today of about two dozen employees come two weeks after Griffin’s New York-based Citadel Securities said it was shutting its equity-research group and its investment bank, ending a three-year effort to build a business that the hedge-fund manager said would rival Goldman Sachs Group Inc.
Griffin, 42, founded Citadel Securities in late 2008 to offer underwriting, stock, bond and derivatives trading and advice on mergers, acquisitions and restructurings. After the business failed to gain traction, Citadel decided to concentrate on building its computer-based trading for institutions as well as its options and equities market-making operations, which started in 2002.
Devon Spurgeon, a spokeswoman for Chicago-based Citadel, declined to comment on the firings.
The sales and trading group had about 100 employees and the investment bank had about 30 people before the shutdown. About 25 of the sales and trading workers will be transferred to other jobs in the securities business, said the people familiar with the decision, who asked not to be named because the information is private.
Last week, Wells Fargo & Co. said it will hire Brian Maier and 24 other bankers from Citadel.
Citadel Securities, which employs about 200 people, according to the people briefed on the move, reported earnings of $81.6 million on revenue of $1.01 billion in 2009, most of which came from market making, according to financial statements filed in February 2010 with the U.S. Securities and Exchange Commission.
While Citadel is paring the securities business, the firm’s two main hedge funds climbed 14 percent this year through yesterday, according to a person familiar with the fund’s performance. Those funds lost 55 percent in 2008 as global markets tumbled.