Deephaven Capital Management, LLC was a subsidiary

Subsidiary

A subsidiary company, subsidiary, or daughter company is a company that is completely or partly owned and wholly controlled by another company that owns more than half of the subsidiary's stock. The subsidiary can be a company, corporation, or limited liability company. In some cases it is a...

 of Knight Capital Group

Knight Capital Group

Knight Capital Group is a global financial services firm based in Jersey City, New Jersey that provides access to the capital markets across multiple asset classes to buy- and sell-side firms and corporations.Knight is a specialized firm with highly developed market-making and trading capabilities...

 that managed various hedge funds. Deephaven was founded in 1994 with $5 million in assets and at its peak managed $4 billion in assets in six different hedge funds.

Downfall

In late 2008, Deephaven froze its Global Multi-Strategy Fund with assets of $1.6 billion. The fund lost 32% in 2008, which resulted in investors requesting to withdraw 30% of their funds. Until then, the fund had yearly returns of 16%. In 2009, Deephaven sold its assets in the Global Multi-Strategy Fund to Stark Investments for $7.3 million. Upon the sale, Deephaven's remaining assets were sold off; the office furniture was sold for cents on the dollar to a local asset manager, Disciplined Growth Investors

Disciplined Growth Investors

Disciplined Growth Investors, Inc. is a SEC-registered independent asset management firm founded in February 1997 by Fred Martin in Minneapolis, Minnesota. Its headquarters are located on the 25th floor of the Fifth Street Towers in downtown Minneapolis....

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