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Avenue hedge fund names CIO as Lasry seen getting ambassadorship

By Katya Wachtel

NEW YORK (Reuters) - As speculation mounts that Avenue Capital hedge fund co-founder Marc Lasry will be nominated as the next U.S. ambassador to France, his $12 billion firm has told investors it is naming its first chief investment officer, according to a memo reviewed by Reuters.

Lasry, who co-founded the distressed debt firm with sister Sonia Gardner in 1995, is a longtime Democratic donor who was one of the few hedge fund managers to support President Barack Obama during his re-election campaign last year.

Reuters reported on Friday that with speculation growing President Obama will soon nominate the 53-year-old Lasry for the overseas job, several institutional investors in the hedge fund said they did not expect investors to be overly concerned if Lasry were to go to France.

On Friday evening, Avenue investors received an email from Gardner that did not explicitly address Lasry's potential move to Paris, but seemed to have been written in response to media reports about the nomination.

"Many of you have asked about the recent speculation in the media regarding Avenue," Gardner wrote in the memo obtained by Reuters, adding that while "we cannot comment on media speculation, I would like to provide you with a general update on the firm."

In the memo, which Lasry did not sign, Gardner said the firm was naming Richard Furst, who has been with the New York-based hedge fund since 2004 and currently oversees the firm's European investment strategy, as its chief investment officer.

"Rich will provide high-level oversight of our investment strategies on a worldwide basis," Gardner wrote. Furst will continue to manage the firm's Europe strategy.

The post is a new one for Avenue, said a person familiar with the firm.

In the note, Gardner emphasized that she has "managed the firm for nearly two decades as president and managing partner." She also said the firm, with 200 employees, has multiple investment teams led by several senior portfolio managers.

If the 53-year-old Lasry is nominated and approved by the U.S. Senate, he would become the first hedge fund manager to serve as an American ambassador.

(Reporting By Katya Wachtel; Editing by Matthew Goldstein and Nick Zieminski)

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