Southeastern Asset Management, manager of the 17-year-old Longleaf Partners Funds, has decided to shut the fund to new investors because of a lack of prospective companies to invest in, the company announced.
As of now, 29% of the funds assets are in cash, and the company decided to turn away new investors until "additional investment opportunities exist and cash inflows would again benefit existing shareholders."
As of June 30, the fund included 19 companies and $8.5 billion worth of assets. This is the third time the fund has closed; it closed from September 1995 to October 1998 and from February 1999 to February 2000.
This marks the second fund in five months closed by Southeastern Asset Management, the Memphis, Tenn.-based firm that opened in 1975. On Feb. 6, the five-and-a-half-year-old Longleaf Partners International Fund was closed indefinitely.
"We are unwilling to commit capital to marginally attractive investments because the risks are higher and the prospective returns are lower," said Mason Hawkins, co-manager of the fund. "We believe that our patience and discipline today will pay off handsomely over the next five years."