Key Takeaways
- • Kite Lake Capital Management, a London-based manager with about $3.9bn in assets, plans to launch a Diversified Credit Fund in the fourth quarter of 2026, according to a Bloomberg report citing an investor note.
- • The fund will combine liquid global credit investments with convertible arbitrage and will be led by partner Damien Regnier, who joined Kite Lake in May from Tyrus Capital, where he headed the convertible bonds business.
- • The launch adds to Kite Lake's growing pipeline of new products aimed at continued investor demand for alternative strategies.
- • Kite Lake's flagship fund gained 18% in 2025 and has never recorded a losing year since its 2011 inception. Its KL Special Opportunities Fund fell 0.67% in September, reducing its 2026 year-to-date gain to 6.26%.
Summary
Kite Lake Capital Management is preparing to launch a new hedge fund focused on global credit and convertible arbitrage, according to a Bloomberg report. The report cites an investor note indicating that the London-based manager intends to launch its Diversified Credit Fund during the fourth quarter. The strategy will be led by Kite Lake partner Damien Regnier and will pair liquid global credit investments with convertible arbitrage. Kite Lake reportedly declined to comment.
Regnier joined Kite Lake in May from Tyrus Capital, where he was a partner and headed the firm's convertible bonds business. His move brings a senior convertibles specialist to the manager, and the new fund extends Kite Lake's existing credit offering into a combined credit and convertible arbitrage mandate. The launch is part of a broader pipeline of new products that reflects ongoing investor appetite for alternative strategies.
Kite Lake, which manages about $3.9bn, was founded in 2011 by Massi Khadjenouri and Jan Lernout, who had worked together at Cheyne Capital from 2005 before establishing the firm. The firm is co-managed by Jamie Sherman and runs strategies spanning merger arbitrage, equity special situations, credit and distressed debt.
Performance data in the investor note shows the firm's flagship fund returned 18% in 2025 and has not recorded a losing year since inception. The KL Special Opportunities Fund declined 0.67% in September, reducing its gain for the year to 6.26%.
Regnier joined Kite Lake in May from Tyrus Capital, where he was a partner and headed the firm's convertible bonds business. His move brings a senior convertibles specialist to the manager, and the new fund extends Kite Lake's existing credit offering into a combined credit and convertible arbitrage mandate. The launch is part of a broader pipeline of new products that reflects ongoing investor appetite for alternative strategies.
Kite Lake, which manages about $3.9bn, was founded in 2011 by Massi Khadjenouri and Jan Lernout, who had worked together at Cheyne Capital from 2005 before establishing the firm. The firm is co-managed by Jamie Sherman and runs strategies spanning merger arbitrage, equity special situations, credit and distressed debt.
Performance data in the investor note shows the firm's flagship fund returned 18% in 2025 and has not recorded a losing year since inception. The KL Special Opportunities Fund declined 0.67% in September, reducing its gain for the year to 6.26%.
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