Regiment Capital Advisors, a firm started by former junk-bond investors from Harvard University’s endowment, is exploring a sale of its last remaining business, a unit focusing on collateralized loan obligations.
The Boston-based firm hired Berkshire Capital to help with a potential sale of the CLO business after shuttering its credit hedge fund last month, said a person familiar with the matter, who asked not to be named because the information is private. Abu Dhabi Investment Authority, the firm’s lone separate account client, notified Regiment it may terminate its relationship, according to the person.
Regiment, led by Thomas Sorbo on the non-investment side, told investors in May that it planned to close its $1.4 billion credit hedge fund after receiving $946 million in redemption requests, according to a letter, a copy of which was viewed by Bloomberg News. The firm said in a separate letter that the decision to close the fund was tied to a number of factors.
Diana Pisciotta, a spokeswoman for Regiment at Denterlein, declined to comment. Erik Portanger, a spokesman for the Abu Dhabi sovereign wealth fund, declined to comment.
Regiment also told investors last month that Brooke Carroll, a partner and collateralized loan obligation structurer and performance analyst, would be departing June 30.
The firm, started in 1999 by Tim Peterson with four other professionals from Harvard Management Co., specializes in high-yield debt. Mark Brostowski, who oversees investments with William Heffron, planned to step down by the end of this year.
Regiment’s main hedge fund declined 8.8 percent in 2014 as plunging oil prices hurt its investments in energy and transportation companies.