The move is reminiscent of Griffin’s fast moves to absorb staff and assets in decades past from sunken foes like energy company Enron and hedge funds Amaranth Advisors and Sowood Capital Management. Those helped make Griffin billions.
The Visium hiring spree comes with another advantage: It helps Griffin and Citadel head off a potential new competitor in the world of multistrategy hedge funds.
Visium said in June it would unwind after an insider-trading probe and other charges brought by federal prosecutors. It said it would sell the one fund that remained to AllianceBernstein, a traditional asset manager looking to expand in the hedge fund business.
Citadel’s move threatens Visium’s AllianceBernstein deal, as the departing traders represent a significant portion of the staff that was to cross over, people familiar with the matter said. After The Wall Street Journal reported Wednesday afternoon on the departures, Visium told investors it would liquidate the fund.
An AllianceBernstein spokesman declined to comment on whether the deal still would go through.
The day after Visium announced last month it largely would close, a new Citadel executive looking to make a splash, Richard Schimel, called Griffin at home on a Saturday with the idea to perhaps pick off the staff.
Griffin’s response: “Go for it,” Schimel recalled.
In a frenetic few weeks of back-to-back all-day interviews, Schimel dangled the prospect of higher pay than the managers made at Visium and a seamless transition.
“The common theme across all the interviews was these guys really wanted to stay together,” he said.
The new employees will form the lion’s share of Schimel’s starting staff at Aptigon, a new Citadel stock-trading hedge fund arm with offices in the New York area and San Francisco. Aptigon will begin trading this fall with billions of dollars.
Write to Rob Copeland at firstname.lastname@example.org
Sarah Krouse contributed to this article, which was published by The Wall Street Journal