Satellite Asset Management LP, a $2.8 billion hedge fund founded by former employees of billionaire George Soros, is closing down because of client withdrawals, Bloomberg said on its website late Friday.

The New York-based firm has started returning money to investors from its three funds, Satellite Overseas Fund Ltd, Satellite Fund II LP and Satellite Credit Opportunities Ltd, the report said, citing a person familiar with the matter.

The three funds oversaw $2.8 billion in client assets, the report said.

Satellite, which oversaw about $7 billion at the end of 2007, was started 10 years ago by Lief Rosenblatt, Gabe Nechamkin and Mark Sonnino, who worked together at Soros Fund Management LP. Satellite in November halted client withdrawals from its funds, which lost more than 35 percent last year, the report said.

The hedge fund could not be reached immediately for comment.

(Reporting by Jui Chakravorty; Editing by Gary Hill)