Millennium Management’s failed takeover talks with Weiss Multi-Strategy Advisers have been revealed in email correspondence made public as part of Weiss’s bankruptcy proceedings. The negotiations, which took place in late February, included demands for significant changes at the troubled hedge fund.
According to the emails, Millennium demanded the firing of all but five portfolio managers, the winding down of the firm’s core staff, and the removal of client cash. They also sought to control Weiss’s finances and only take on obligations to strategic partner Leucadia Asset Management.
Additionally, Millennium requested that Weiss Chief Investment Officer Jordi Visser step down and asked for new contracts for portfolio managers that included protections for the firm. They also wanted “additional protections” related to portfolio manager departures.
Despite offering to provide Weiss with up to $30 million to repay Leucadia and $25 million for retention payments for portfolio managers, Millennium ultimately walked away from the deal. Weiss went on to file for court protection in April.
The details of the failed takeover offer a rare glimpse into deal negotiations between hedge funds, shedding light on the inner workings of the industry. Representatives for Millennium, Weiss, and Leucadia declined to comment on the matter.
As industry giants continue to grow and seek external firms to manage their cash, such negotiations are becoming more common. The fallout from the failed talks between Millennium and Weiss serves as a cautionary tale for the hedge fund industry.