HOUSTON/NEW YORK, July 6 (Reuters) - Sierentz Global Merchants, a commodities trading firm controlled by members of the Louis-Dreyfus family, is exiting its physical energy business, three people familiar with the matter said on Friday.
Profits in the physical energy business fell short of expectations, two of the sources said. A Sierentz representative of the Connecticut-based firm declined to comment on its businesses, which have included energy markets like natural gas and a more recent foray into agricultural products.
The unwinding would not affect its physical grains trading or all aspects of the firm's energy trade, two of the sources said. They did not specify what other energy trade the firm was engaged in.
Commodity trading companies, funds and banks struggled to make profits in energy in 2017 due to muted client activity and market volatility. Big funds that have closed over the past year include Andy Hall's Astenbeck Capital Management and Texas tycoon T. Boone Pickens' BP Capital.
The Connecticut-based business was run by Drew Grams, formerly a senior partner at Tokamak Energy Partners before joining Sierentz as president in July 2016, according to his LinkedIn profile and sources.
Sierentz is controlled by members of the Louis-Dreyfus family but operates separately from the commodity merchant that bears the family's name, the Louis Dreyfus Co.
The firm was launched by a member of the Dreyfus family after the trading powerhouse split off its energy unit, said another source based in Geneva.
The U.S. company mainly trades energy products such as natural gas, but has recently made a big push into grains. Sierentz launched the physical grains trading business four months ago, poaching Louis Dreyfus' head of grains David Ohayon and a group of his colleagues last August.
Sierentz has diversified into other agricultural commodities such as sugar. The grains business and other units will be unaffected by the closure, said two of the sources familiar with the decision.
It was not immediately clear how many of Sierentz' traders and other employees would be affected by the shuttering. Sierentz North America has 11-50 employees, according to its LinkedIn profile. (Reporting by Liz Hampton in Houston and Chris Prentice and Devika Krishna Kumar in New York Editing by Simon Webb and David Gregorio)