New York-based private equity firm Quadrangle Capital Partners will substantially close its London office and pursue its European investments out of the United States, an investor letter dated Friday said.

Quadrangle -- co-founded by Steven Rattner, who left the firm earlier this year -- also plans to increase resources in Asia and raise its focus on its existing portfolio to create a heightened focus on realizations and exits, according to the letter, a copy of which was obtained by Reuters.

Quadrangle has investments in assets such as movie studio Metro-Goldwyn-Mayer, cinema firm Cinemark, teleconferencing company West Corp and Alpha Media, parent of men's magazine Maxim.

Private equity firms have faced an uphill task keeping portfolio companies -- which typically have high debt loads -- healthy during the economic turmoil. An added problem is finding new investment opportunities after the credit crunch put an end to cheap financing.

Quadrangle's letter says the company -- which has an office in Hong Kong, led by Edward Sippel, that it opened in 2008 -- sees opportunities for attractive investment returns in Asia and plans to increase its emphasis there.

However, to do that, the letter said, the company has to de-emphasize certain activities. It will pursue European investments on a selective basis from the United States and will substantially close its London office, the letter said.

Gordon Holmes, who led the firm's London office, will leave the firm because he wishes to remain in the region, the letter said. Holmes launched the London office in 2007 and led deals such as an investment in cable firm Get AS in Norway, according to Quadrangle's website.

Quadrangle also does not plan to launch new business lines in the foreseeable future, the letter said, and its chief operating officer -- Doug Kramer, a former Goldman Sachs partner who joined Quadrangle in 2008 -- will leave the firm.

The changes mean its number of investment professionals will be reduced to 23 from 27 by the end of the year.

The letter is signed by Quadrangle co-presidents Michael Huber and Joshua Steiner, who took over at the helm in February when Rattner left to become head of the U.S. autos task force. Rattner left that role in July.

Quadrangle, which has two private equity funds, put on hold plans to raise a third after Rattner's departure and amid the financial turmoil, which made raising new money from investors tough.

Quadrangle declined comment. (Reporting by Megan Davies; Editing by Gary Hill)

London Investment