Fortress halts withdrawals 

Intrawest’s parent company Fortress Investment Group LLC told investors Wednesday that they won’t get their money back for some time, as the company suspended redemptions in one of its funds.

Fortress, a private equity and hedge fund firm, said it had temporarily suspended redemptions at its Drawbridge Global Macro fund after receiving requests to withdraw more than $3.5 billion.

Shares of Fortress plunged 30 per cent Wednesday, to as low as $1.71, following the announcement.

As of Sept. 30, the Drawbridge Global Macro funds had $8 billion in assets under management, Fortress said. In Wednesday’s filing, Fortress estimated that, with the latest wave of redemptions halted, the fund would have $3.65 billion in assets under management on Jan. 1, 2009.

Fortress had been preparing for investors to withdraw their money and in a conference call last month CEO Wesley Edens said, “we expect to experience increased redemptions at year end.”

Several other hedge fund managers have recently blocked redemptions to prevent a forced fire sale of their investments. Reuters reported that: “Suspending redemptions was once a sign that a fund was about to fail, but it is now a much more accepted tool to safeguard capital — for a while at least.”

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