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‘Graveyard of Zombie Funds’

July 7, 2012

From June 5th NY Post by Josh Kosman “Private-equity firm Behrman sucks fees from ‘zombie’ fund“:

A New York private-equity firm has found a creepy way to revive one of its near-dead funds.

Behrman Capital is forming a new fund with a six-year life span to buy out an old $1.2 billion fund it closed back in 2001.

The move will allow the firm, founded by brothers Darryl and Grant Behrman, more time to sell out its remaining investments and collect fees and commissions.

Behrman is venturing into a graveyard of “zombie funds” whose time has run out. Rather than let them die, some PE firms are looking at novel (some say horrifying) ways to resurrect the aging funds and continue to profit from them.

and:

Behrman, still run by the surviving brother Grant, is among a growing number of exceptions, according to Wider. As a result, the Securities and Exchange Commission is scrutinizing so-called zombie funds.

zombie josh kosman

For similar themes seem ZombieLaw posts “Is Mitt Romney Bela Lugosi?” about Bain Capital as vampire and Zombie illiquidity about dying funds and the GM/GMAC case about vampire corporation sucking zombie corporation.

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From → economics, money

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