Millennium Management, during their discussions to acquire Weiss Multi-Strategy Advisers, requested several substantial modifications, which included terminating all but five portfolio managers, downsizing the firm’s core staff, and withdrawing client funds. These specific demands were revealed through email exchanges that were released as part of Weiss’s bankruptcy case. The negotiations occurred in late February but ultimately collapsed when Millennium decided to discontinue the deal. Subsequently, Weiss filed for bankruptcy protection in April.
According to an email sent on February 22 from Millennium Chief Strategic Development Officer Mark Meskin to Weiss founder George Weiss and Deputy Chief Investment Officer Mike Edwards, Millennium wanted to have control over Weiss’ finances and would only take on certain obligations to strategic partner Leucadia Asset Management. Millennium founder Izzy Englander was also included in the email.
The email also revealed that Millennium requested Weiss Chief Investment Officer Jordi Visser to step down, as previously reported by Bloomberg. Additionally, Millennium wanted new contracts for portfolio managers that included safeguards for the firm and requested “additional protections” related to portfolio manager departures.
A spokesperson for Millennium declined to comment, while representatives for Weiss and Leucadia did not respond to requests for comment made after regular business hours.
The abundance of information provides a unique opportunity to observe the negotiations between hedge funds, which have become increasingly common as large industry players aim to outsource their cash management and reduce costs.
According to emails, Millennium proposed providing Weiss with up to $30 million to repay Leucadia, a subsidiary of Jefferies Financial Group, in exchange for a complete release from any future obligations. Additionally, Millennium offered Weiss $25 million as retention payments for their portfolio managers.