NEW YORK (

TheStreet

) --

Goldman Sachs

(GS) - Get Report

will shutter its flagship Global Alpha Fund after significant losses and a management shakeup, the

Wall Street Journal

reported Thursday, citing sources familiar with the matter.

News of problems at the fund were first reported by

Reuters

on Wednesday.

Goldman has apparently decided to close the $1 billion hedge fund as a result of investor redemptions prompted by poor performance. The firm will distribute a majority of the assets to existing investors with some portion of the cash to be held back by Goldman to pay for possible legal costs, the

Journal

states.

Global Alpha was part of Goldman Sachs' quantitative funds unit and at one point boasted more than $12 billion in assets, according to published reports. Starting in 2007, however, and throughout the financial crisis, the fund absorbed significant losses and investors bolted from investment vehicle.

On Wednesday

Reuters

reported that head of the the quantitative strategy group, Katinka Domotorffy, would retire at the end of the year and that management was being overhauled in response to poor performance at the fund.

--

Written by Christopher Westfall in New York

.