Cohen's SAC will close London office by year-end: memo
By Katya Wachtel
NEW YORK (Reuters) - Steven A. Cohen's SAC Capital Advisors will shut its London office by the end of the year as the hedge fund downsizes in response to a long-running insider trading investigation, according to a memo sent to staff on Tuesday.
In the memo, SAC President Tom Conheeney, who informed the London staff of the decision in person on Tuesday, also told employees that the hedge fund cut six portfolio managers based in the United States this week.
"As our negotiations with the government have unfolded, it has become clear to us that the outcome the government is demanding is likely to have a greater than first anticipated impact on the firm," Conheeney wrote in the memo, a copy of which was obtained by Reuters. "We have concluded that we must operate as a simpler firm and reduce our capital allocations."
He said the decision to close the office "was not something we had been contemplating."
An SAC official declined comment on the contents of memo. The size of the London staff was not disclosed.
The pending London closure was first reported by Bloomberg.
This summer, U.S. prosecutors indicted Cohen's firm, saying SAC fostered a culture in which employees flouted the law and were encouraged to tap their personal networks of contacts for inside information about publicly traded companies.
SAC is close to reaching a deal with U.S. prosecutors to resolve the insider trading case against it, Reuters reported last week. Continued...