Hedge fund liquidating
According to the firm’s former marketing and investor relations chief, a prospective investor discovered that the firm was under SEC investigation—a fact it had not disclosed either to investors, or to the IR executive, Miriam Freier, hired a year earlier.
Freier, who is now suing the firm, told that she was warned not to disclose the investigation to anyone while it completed the settlement negotiations.
The firm spun off its Pacific Opportunities Fund on Feb.
1 and is in the process of doing so with its last remaining fund, Boyer Allan Emea.
Last month, she sought to resign, but was asked to stay on until February to help advise clients about the wind-down.
But she was fired last week after she rejected Vertical’s separation agreement.
Liquidate is also a term used in bankruptcy procedures in which an entity chooses or is forced by a legal judgment or contract to turn assets into a "liquid" form (cash). In the investments arena, liquidation occurs when an investor decides to close out his or her position on a particular asset or security.
While businesses can liquidate assets to free up cash even in the absence of financial hardship, asset liquidation in the business world is mostly done as part of a bankruptcy procedure.When a company fails to repay its creditors due to financial hardship and prolonged losses in its operations, a bankruptcy court may order a compulsory liquidation of the business assets if the company is found to be insolvent.The secured creditors would take over the assets that were pledged as collateral before the loan was approved.The shareholders appoint a liquidator who dissolves the company by collecting the assets of the solvent company, liquidating the assets, and distributing the proceeds to employees who are owed wages and to creditors in order of priority.Any cash that remains is then distributed to preferred shareholders, if any, before common shareholders get a cut.