PlusFunds Group is going out of business, after a sale of its assets to its acquisition by private equity manager FTVentures fell through, according to a filing in U.S. Bankruptcy Court in New York.
FTVentures pulled out of the deal on May 1, according to court documents; court papers explaining its reasons were sealed. Bear Stearns, which sought to be a backup bidder for PlusFunds, withdrew its bid on May 2, according to bankruptcy court documents; the company did not provide reasons for its withdrawal.
PlusFunds submitted a wind-down plan to the bankruptcy court on May 10, but a hearing date has not been set for approval of the plan. About half of the firm's employees were terminated on May 5, and 18 employees will remain in place to manage the assets until the company ceases operation within the next three months. PlusFunds currently manages about $450 million, but that will decline to about $63 million by the end of July, according to court filings; it managed more than $2.5 billion in hedge fund assets at its height.
PlusFunds applied for Chapter 11 bankruptcy protection in March and announced in early April that it had reached a deal to sell its operations to FTVentures, subject to an auction seeking "higher or better offers."