Citadel Investment Group will launch a leveraged finance group in October, the Chicago-based hedge fund confirmed. The new unit will be part of its Citadel Securities division and will be based in New York.

The firm had been building a team with leveraged finance veterans for some months. Citadel hired former Merrill Lynch alums Carl Mayer and Brian Maier in May to head leveraged finance and industry groups, respectively.

Rohit D'Souza, previously Merrill's head of global equities and America’s global markets, is Citadel’s CEO; Todd Kaplan, who ran Merrill's capital markets business, is the firm's head of investment banking.

Citidel’s trading desk will trade loans, bonds and derivatives. The firm has already begun advising companies on deals.

Citadel Investment Group manages approximately $13.5 billion.

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