(Bloomberg) -- Orkun Kilic is closing his hedge fund Berry Street Capital Management four years after its inception, citing high interest rates and a challenging regulatory environment. 

The London-based fund, which pursued an event-driven strategy and oversaw over $900 million at its peak, has struggled in 2023, seeing losses of 4.2% in the nine months through September. Assets under management at the time of its decision to shutter were $575 million.

Kilic, a former Paulson Europe LLP partner, founded Berry Street Capital in 2019 with over $400 million in initial backing from Schonfeld Strategic Advisors and Partners Capital. He previously worked at Morgan Stanley in London.

“The current investment landscape is simultaneously constrained by rising rates and regulatory uncertainty and not conducive to achieve the risk adjusted returns that we used to generate,” Kilic said. “The right thing to do is to return capital to our investors.” 

Event-driven fund strategies — which bet on corporate or news events like mergers and acquisitions, bankruptcies or hostile takeovers — have had a rough year as regulators step up antitrust efforts. Higher borrowing costs and economic uncertainty have also slowed dealmaking. 

Changing regulations have prompted event-driven funds, in many cases, to switch their playbooks — unwinding struggling positions altogether, focusing more on trading swings in spreads as deal prospects fluctuate, or scaling up wagers more slowly. 

Partners Capital was no longer an investor in Kilic’s fund at the time of its decision to close.

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