SIV still struggling after Goldman bailout

The $7 billion SIV Portfolio was formerly managed by Cheyne Capital Management.

A structured investment vehicle formerly known as Cheyne Finance PLC that was bailed out a month ago by The Goldman Sachs Group Inc. is continuing to struggle with little interest shown in an auction of its assets held this week, according to published reports.

The $7 billion SIV Portfolio PLC of Dublin, Ireland, which was formerly managed by London-based Cheyne Capital Management (U.K.) LLP, only pay investors with claims in the securities 44% of face value.

SIVs, which are products that borrow money by issuing short-term securities that it then lends by purchasing long-term investments, began to face losses during the subprime meltdown last year.

Any unsold assets from the auction will be transferred to a new fund set up by New York-based Goldman Sachs, which agreed to save SIV Portfolio in mid-June a year after it faced massive losses due to the crumbling of the commercial-paper market.