UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-21537
Name of Fund: BlackRock Multi-Strategy Hedge Opportunities, LLC
Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809
Name and address of agent for service: Donald C. Burke, Chief Executive Officer,
BlackRock Multi-Strategy Hedge Opportunities, LLC, 800 Scudders Mill Road,
Plainsboro, NJ 08536. Mailing address: P.O. Box 9011, Princeton, NJ
08543-9011
Registrant's telephone number, including area code: (877) GPC-ROCK
Date of fiscal year end: 03/31/2008
Date of reporting period: 04/01/2007 - 03/31/2008
Item 1 - Report to Stockholders
EQUITIES FIXED INCOME REAL ESTATE
LIQUIDITY ALTERNATIVES BLACKROCK SOLUTIONS
BlackRock Multi-Strategy Hedge Opportunities LLC BLACKROCK
ANNUAL REPORT | MARCH 31, 2008
NOT FDIC INSURED
MAY LOSE VALUE
NO BANK GUARANTEE
Table of Contents
================================================================================
Page
- --------------------------------------------------------------------------------
A Letter to Members ........................................................ 3
Annual Report:
Company Summary ............................................................ 4
Disclosure of Expenses ..................................................... 5
Financial Statements:
Schedule of Investments .................................................. 6
Statement of Assets and Liabilities ...................................... 7
Statement of Operations .................................................. 7
Statements of Changes in Net Assets ...................................... 8
Statement of Cash Flows .................................................. 9
Financial Highlights ....................................................... 10
Notes to Financial Statements .............................................. 11
Report of Independent Registered Public Accounting Firm .................... 14
Officers and Directors ..................................................... 15
Additional Information ..................................................... 19
2 BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008
A Letter to Members
Dear Member
Financial markets endured severe bouts of volatility during the reporting
period, particularly as the calendar turned to 2008. It was then that fears of
an economic recession swelled and credit market strains intensified, producing
calamity in the financial system and, ultimately, the demise of major Wall
Street firm Bear Stearns.
The Federal Reserve Board (the "Fed"), after cutting the target federal funds
rate 100 basis points (1%) between September 2007 and year-end, stepped up its
efforts to support the ailing financial sector in the first three months of
2008. The central bank cut interest rates 125 basis points in January alone, and
followed with another 75-basis-point cut on March 18, bringing the target rate
to 2.25%. In an unprecedented move, the Fed also extended its financing
operations directly to broker/dealers and assisted JPMorgan in its buyout of
ill-fated Bear Stearns.
Against this backdrop, investor anxiety has been acute and equity markets have
struggled. The S&P 500 Index of U.S. stocks was down in March, marking the fifth
consecutive month of negative returns. International markets outperformed the
U.S. for much of 2007, but that trend changed in more recent months as investors
grew increasingly reluctant to take on the risks of foreign investing.
In fixed income markets, an ongoing investor flight to quality continued to
drive Treasury yields lower and their prices higher. The yield on 10-year
Treasury issues, which touched 5.30% in June 2007 (its highest level in five
years), fell to 4.04% by year-end and to 3.45% by March 31. Investors largely
shunned bonds associated with the housing and credit markets, and the riskier
high yield sector landed in negative territory year-to-date. Meanwhile, the
municipal bond market has struggled with concerns around the creditworthiness of
monoline bond insurers and the failure of auctions for auction rate securities,
driving yields higher and prices lower across the curve. At period-end,
municipal bonds were trading at higher yields than their Treasury counterparts,
a very unusual occurrence by historical standards.
Overall, the major benchmark indexes posted mixed results for the current
reporting period, generally reflecting heightened investor risk aversion:
Total Returns as of March 31, 2008 6-month 12-month
==============================================================================================================
U.S. equities (S&P 500 Index) -12.46% - 5.08%
- --------------------------------------------------------------------------------------------------------------
Small cap U.S. equities (Russell 2000 Index) -14.02 -13.00
- --------------------------------------------------------------------------------------------------------------
International equities (MSCI Europe, Australasia, Far East Index) -10.50 - 2.70
- --------------------------------------------------------------------------------------------------------------
Fixed income (Lehman Brothers U.S. Aggregate Index) + 5.23 + 7.67
- --------------------------------------------------------------------------------------------------------------
Tax-exempt fixed income (Lehman Brothers Municipal Bond Index) + 0.75 + 1.90
- --------------------------------------------------------------------------------------------------------------
High yield bonds (Lehman Brothers U.S. Corporate High Yield 2% Issuer Capped Index) - 4.01 - 3.47
- --------------------------------------------------------------------------------------------------------------
Past performance is no guarantee of future results. Index performance shown for
illustrative purposes only. You cannot invest directly in an index.
As you navigate today's volatile markets, we encourage you to review your
investment goals with your financial professional and to make portfolio changes,
as needed. For more up-to-date commentary on the economy and financial markets,
we invite you to visit www.blackrock.com/funds. As always, we thank you for
entrusting BlackRock with your investment assets, and we look forward to
continuing to serve you in the months and years ahead.
Sincerely,
/s/ Rob Kapito
Rob Kapito
President, BlackRock Advisors, LLC
3
THIS PAGE NOT PART OF YOUR FUND REPORT
Company Summary as of March 31, 2008
Investment Objective
BlackRock Multi-Strategy Hedge Opportunities LLC (the "Company") seeks high
total return over a full market cycle through investments in hedge funds and
other investment vehicles pursuing alternative investment strategies.
Performance
For the 12-month period ended March 31, 2008, the Company returned -3.73% based
on net asset value (NAV). For the same period, the Hedge Fund Research Inc. Fund
of Funds Composite Index returned +2.78% on a NAV basis. Ongoing issues in
residential real estate and structured credit markets, as well as fear of
economic recession and inflation, led to aggressive investor risk reduction,
dissipating liquidity and steep declines in valuations across a number of asset
classes. Against this backdrop, managers in the credit, relative value and
equity-based strategies suffered most, while global macro and commodities
strategies generally fared well. Short positions in the U.S. dollar and long
exposures to the energy complex contributed the most to the profits of the
fund's underlying managers.
Company Information
The following charts show the ten largest holdings and investments by strategy
of the Company's long-term investments:
Ten Largest Holdings
Suttonbrook Capital Partners LP ............................................ 9%
ARX Global High Yield Securities Fund I LP ................................. 8
Glenview Institutional Partners LP ......................................... 8
LibertyView Credit Opportunities Fund II LLC ............................... 8
Crabel Fund LP ............................................................. 8
Aristeia Partners LP ....................................................... 8
Trivium Onshore Fund LP .................................................... 8
Grinham Diversified Fund (U.S.) LP ......................................... 7
SR Phoenicia LP ............................................................ 7
Double Black Diamond LP .................................................... 6
- --------------------------------------------------------------------------------
Investments by Strategy
3/31/08 3/31/07
- --------------------------------------------------------------------------------
Equity Opportunistic ....................................... 36% 38%
Directional ................................................ 19 23
High Yield ................................................. 16 15
Multi-Strategy ............................................. 15 12
Convertible Arbitrage ...................................... 12 8
Event Driven ............................................... 2 --
Equity Neutral ............................................. -- 4
- --------------------------------------------------------------------------------
The table below summarizes the change in the Company's net asset value per unit:
- --------------------------------------------------------------------------------
3/31/08 3/31/07 Change High Low
- --------------------------------------------------------------------------------
Net Asset Value ........... $1.1229 $1.1664 (3.73%) $1.2421 $1.1229
- --------------------------------------------------------------------------------
The table below provides the Company's average annual total returns:
Average Annual Total Return
Return Without Return With
Sales Charge Sales Charge*
================================================================================
One Year Ended 3/31/08 -3.73% -6.62%
- --------------------------------------------------------------------------------
Inception (1/03/05)
through 3/31/08 +3.64 +2.67
- --------------------------------------------------------------------------------
* Maximum sales charge is 3%.
Past results shown should not be considered a representation of future
performance.
4 BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008
Disclosure of Expenses
Members of this Company may incur the following charges: (a) expenses related to
transactions, including sales charges, redemption fees and exchange fees; and
(b) operating expenses, including advisory fees, distribution fees including
12b-1 fees, and other Company expenses. The expense example below (which is
based on a hypothetical investment of $1,000 invested on October 1, 2007 and
held through March 31, 2008) is intended to assist members both in calculating
expenses based on an investment in the Company and in comparing these expenses
with similar costs of investing in other mutual funds.
The table provides information about actual account values and actual expenses.
In order to estimate the expenses a member paid during the period covered by
this report, members can divide their account value by $1,000 and then multiply
the result by the number in the first line under the heading entitled "Expenses
Paid During the Period."
The table also provides information about hypothetical account values and
hypothetical expenses based on the Company's actual expense ratio and an assumed
rate of return of 5% per year before expenses. In order to assist members in
comparing the ongoing expenses of investing in this Company and other funds,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in other funds' shareholder reports.
The expenses shown in the table are intended to highlight members' ongoing costs
only and do not reflect any transactional expenses, such as sales charges,
redemption fees or exchange fees. Therefore, the second table is useful in
comparing ongoing expenses only, and will not help members determine the
relative total expenses of owning different funds. If these transactional
expenses were included, member expenses would have been higher.
Expense Example
Actual Hypothetical**
--------------------------------------------------- ---------------------------------------------------
Beginning Ending Beginning Ending
Account Value Account Value Expenses Paid Account Value Account Value Expenses Paid
October 1, 2007 March 31, 2008 During the Period* October 1, 2007 March 31, 2008 During the Period*
- ------------------------------------------------------------------------------------------------------------------------------------
BlackRock Multi-Strategy
Hedge Opportunities LLC .. $1,000 $932 $12.30 $1,000 $1,012 $12.81
- ------------------------------------------------------------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 2.55%, multiplied by
the average account value over the period, multiplied by 183/366 (to
reflect the one-half year period shown).
** Hypothetical 5% annual return before expenses is calculated by pro-rating
the number of days in the most recent fiscal half year divided by 366.
BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008 5
Schedule of Investments March 31, 2008
(Percentages shown are based on Net Assets)
Strategy Portfolio Funds Value
===================================================================================================================================
Convertible Arbitrage -- 11.4% Aristeia Partners LP $ 7,802,191
Ishin Fund LLC 4,352,341
------------
12,154,532
===================================================================================================================================
Directional -- 18.7% Crabel Fund LP 8,018,219
FORT Global Contrarian LP 4,400,733
Grinham Diversified Fund (U.S.) LP 7,443,405
------------
19,862,357
===================================================================================================================================
Equity Opportunistic -- 35.6% Glenview Institutional Partners LP 8,428,211
Hayground Cove Institutional Partners LP 5,682,155
Kinetics Partners LP 5,862,061
Neon Liberty Emerging Markets Fund LP 3,002,702
SR Phoenicia LP 7,030,870
Trivium Onshore Fund LP 7,819,060
------------
37,825,059
===================================================================================================================================
Event Driven -- 2.3% Gruss Global Investors LP 2,472,203
===================================================================================================================================
High Yield -- 15.7% ARX Global High Yield Securities Fund I LP 8,638,351
LibertyView Credit Opportunities Fund II LLC 8,035,136
------------
16,673,487
===================================================================================================================================
Multi-Strategy -- 14.8% Double Black Diamond LP 6,418,637
Suttonbrook Capital Partners LP 9,257,298
------------
15,675,935
===================================================================================================================================
Total Investments** (Cost -- $90,744,097*) -- 98.5% 104,663,573
Other Assets Less Liabilities -- 1.5% 1,567,175
------------
Net Assets -- 100.0% $106,230,748
============
* The cost and unrealized appreciation (depreciation) of investments as of
March 31, 2008, as computed for federal income tax purposes, were as
follows:
Aggregate cost ........................................... $ 102,170,009
=============
Gross unrealized appreciation ............................ $ 6,651,655
Gross unrealized depreciation ............................ (4,158,091)
-------------
Net unrealized appreciation .............................. $ 2,493,564
=============
** Non-income producing securities.
See Notes to Financial Statements.
6 BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008
Statement of Assets and Liabilities
March 31, 2008
===============================================================================
Assets
- -------------------------------------------------------------------------------
Investments in Portfolio Funds, at value
(identified cost -- $90,744,097) ............................. $ 104,663,573
Cash ........................................................... 2,056,978
Investments sold receivable .................................... 6,291,904
Interest receivable -- affiliated .............................. 5,702
Prepaid expenses and other assets .............................. 4,840
-------------
Total assets ................................................... 113,022,997
-------------
===============================================================================
Liabilities
- -------------------------------------------------------------------------------
Payables:
Investment adviser ........................................... 908,685
Service agents ............................................... 149,972
Tendered units payable ......................................... 5,194,654
Accrued expenses and other liabilities ......................... 538,938
-------------
Total liabilities .............................................. 6,792,249
-------------
===============================================================================
Net Assets
- -------------------------------------------------------------------------------
Net Assets ..................................................... $ 106,230,748
=============
===============================================================================
Net Assets Consist of
- -------------------------------------------------------------------------------
Members' capital ............................................... $ 90,323,979
Net unrealized appreciation/depreciation on investments ........ 13,919,476
Net accumulated realized gain on investments ................... 10,769,813
Net accumulated investment loss ................................ (8,782,520)
-------------
Net Assets ..................................................... $ 106,230,748
=============
Units outstanding .............................................. 94,602,735
=============
Net asset value per unit ....................................... $ 1.1229
=============
Statement of Operations
Year Ended March 31, 2008
===============================================================================
Investment Income
- -------------------------------------------------------------------------------
Interest -- affiliated ......................................... $ 283,892
-------------
===============================================================================
Expenses
- -------------------------------------------------------------------------------
Investment advisory ............................................ 1,907,717
Accounting and administration services ......................... 388,068
Service agent .................................................. 317,643
Professional ................................................... 281,804
Printing and member reports .................................... 92,961
Custodian ...................................................... 73,861
Loan interest expense .......................................... 7,563
Other .......................................................... 22,495
-------------
Total expenses ................................................. 3,092,112
-------------
Net investment loss ............................................ (2,808,220)
-------------
===============================================================================
Realized and Unrealized Gain (Loss)
- -------------------------------------------------------------------------------
Net change in unrealized appreciation/depreciation
on investments ............................................... (3,839,482)
Net realized gain on investments ............................... 2,932,889
-------------
Net total unrealized and realized loss ......................... (906,593)
-------------
Net Decrease in Net Assets Resulting from Operations ........... $ (3,714,813)
=============
See Notes to Financial Statements.
BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008 7
Statements of Changes in Net Assets
Year Ended March 31,
-----------------------------
Increase (Decrease) in Net Assets 2008 2007
===================================================================================================================================
Operations
- -----------------------------------------------------------------------------------------------------------------------------------
Net investment loss ................................................................................ $ (2,808,220) $ (2,684,984)
Net change in unrealized appreciation/depreciation on investments .................................. (3,839,482) 7,176,547
Net realized gain on investments ................................................................... 2,932,889 6,982,673
-----------------------------
Net increase (decrease) in net assets resulting from operations .................................... (3,714,813) 11,474,236
-----------------------------
===================================================================================================================================
Capital Transactions
- -----------------------------------------------------------------------------------------------------------------------------------
Net proceeds from issuance of units ................................................................ 8,407,988 22,515,567
Fair value of units tendered ....................................................................... (27,354,135) (30,548,590)
-----------------------------
Decrease in net assets derived from capital transactions ........................................... (18,946,147) (8,033,023)
-----------------------------
===================================================================================================================================
Net Assets
- -----------------------------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets ............................................................ (22,660,960) 3,441,213
Beginning of year .................................................................................. 128,891,708 125,450,495
-----------------------------
End of year ........................................................................................ $ 106,230,748 $ 128,891,708
=============================
Net accumulated investment loss .................................................................... $ (8,782,520) $ (5,974,300)
=============================
See Notes to Financial Statements.
8 BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008
Statement of Cash Flows
Year Ended March 31, 2008
===================================================================================================================================
Cash Provided by Operating Activities
- -----------------------------------------------------------------------------------------------------------------------------------
Net decrease in net assets resulting from operations ................................................................ $ (3,714,813)
------------
Adjustments to reconcile net decrease in net assets resulting from operations to net cash
provided by operating activities:
Decrease in investments paid in advance ......................................................................... 13,000,000
Decrease in receivables and other assets ........................................................................ 10,221
Increase in liabilities ......................................................................................... 480,383
Net change in unrealized appreciation/depreciation on investments ............................................... 3,839,482
Net realized gain on investments ................................................................................ (2,932,889)
Purchases of long-term securities ................................................................................... (29,050,000)
Sales of long-term securities ....................................................................................... 45,328,423
------------
Net cash provided by investing activities ........................................................................... 26,960,807
------------
===================================================================================================================================
Cash Used for Financing Activities
- -----------------------------------------------------------------------------------------------------------------------------------
Receipts from issuance of Units ..................................................................................... 6,695,142
Payments from tender of Units ....................................................................................... (27,826,398)
Payments on borrowings .............................................................................................. (3,900,000)
------------
Net cash used for financing activities .............................................................................. (25,031,256)
------------
===================================================================================================================================
Cash
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase in cash ................................................................................................ 1,929,551
Cash at beginning of period ......................................................................................... 127,427
------------
Cash at end of period ............................................................................................... $ 2,056,978
============
===================================================================================================================================
Cash Flow Information
- -----------------------------------------------------------------------------------------------------------------------------------
Cash paid for interest .............................................................................................. $ 9,653
============
See Notes to Financial Statements.
BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008 9
Financial Highlights
Period
January 3,
Year Ended March 31, 2005 4 to
------------------------------------------ March 31,
2008 2007 2006 2005
=================================================================================================================================
Per Unit Operating Performance
- ---------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period ............................ $ 1.1664 $ 1.0693 $ 0.9979 $ 1.0000
----------------------------------------------------------
Net investment loss 3 ........................................... (0.0266) (0.0225) (0.0266) (0.0070)
Net unrealized and realized gain (loss) on investments .......... (0.0169) 0.1196 0.0980 0.0049
----------------------------------------------------------
Net increase (decrease) from investment operations .............. (0.0435) 0.0971 0.0714 (0.0021)
----------------------------------------------------------
Net asset value, end of period .................................. $ 1.1229 $ 1.1664 $ 1.0693 $ 0.9979
==========================================================
=================================================================================================================================
Total Investment Return 2
- ---------------------------------------------------------------------------------------------------------------------------------
Total investment return ......................................... (3.73%) 9.08% 7.16% (0.21%) 5
==========================================================
=================================================================================================================================
Ratios to Average Net Assets
- ---------------------------------------------------------------------------------------------------------------------------------
Total expenses .................................................. 2.43% 2.36% 2.84% 3.28% 1
==========================================================
Total expenses net of reimbursement ............................. 2.43% 2.36% 2.78% 2.96% 1
==========================================================
Net investment loss ............................................. (2.21%) (2.05%) (2.65%) (2.83%) 1
==========================================================
=================================================================================================================================
Supplemental Data
- ---------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) ........................ $ 106,231 $ 128,892 $ 125,450 $ 75,347
==========================================================
Portfolio turnover .............................................. 35% 51% 19% 0%
==========================================================
1 Annualized.
2 Total investment returns exclude the effects of sales charges.
3 Based on average units outstanding.
4 Commencement of operations.
5 Aggregate total investment return; not annualized.
See Notes to Financial Statements.
10 BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008
Notes to Financial Statements
1. Significant Accounting Policies:
BlackRock Multi-Strategy Hedge Opportunities LLC (the "Company") is registered
under the Investment Company Act of 1940, as amended, as a closed-end,
non-diversified management investment company. The Company's financial
statements are prepared in conformity with accounting principles generally
accepted in the United States of America, which may require the use of
management accruals and estimates. Actual results may differ from these
estimates. The Company offers one class of units, which may be sold with a
front-end sales charge. The following is a summary of significant accounting
policies followed by the Company.
Valuation of Investments in Portfolio Funds: The Company values its investments
in Portfolio Funds at fair value in accordance with procedures established by
the Board of Directors. The valuations reported by the Portfolio Fund Managers
of the Portfolio Funds, upon which the Company calculates its month-end net
asset value and net asset value per Unit, may be subject to later adjustment,
based upon information reasonably available at that time. The Company will pay
repurchase proceeds, as well as calculate management fees, on the basis of net
asset valuations determined using the best information available as of the
valuation date. In the event a Portfolio Fund subsequently corrects, revises or
adjusts a valuation after the Company has determined a net asset value, the
Company will generally not make any retroactive adjustment to such net asset
value, or to any amounts paid based on such net asset value, to reflect a
revised valuation.
Income Taxes: The Company is classified as a partnership for federal income tax
purposes. As such, each investor in the Company is treated as owner of its
proportionate share of the net assets, income, expenses and realized and
unrealized gains and losses of the Company. Therefore, no federal income tax
provision is required.
Security Transactions and Investment Income: Portfolio Fund transactions are
recorded on the effective dates of the transactions. Realized gains and losses
on Portfolio Fund transactions are determined on the average cost basis.
Interest income is recognized on the accrual basis.
Cash Balances: The Company maintains cash in a PNC interest-bearing money market
account, which, at times, may exceed federally insured limits. The Company has
not experienced any losses in such account and does not believe it is exposed to
any significant credit risk on such bank deposits. All interest income earned
will be paid to the Company.
Recent Accounting Pronouncements: Effective September 28, 2007, the Company
implemented Financial Accounting Standards Board ("FASB") Interpretation No. 48,
"Accounting for Uncertainty in Income Taxes -- an interpretation of FASB
Statement No. 109" ("FIN 48"). FIN 48 prescribes the minimum recognition
threshold a tax position must meet in connection with accounting for
uncertainties in income tax positions taken or expected to be taken by an
entity, including investment companies, before being measured and recognized in
the financial statements. Management has evaluated the application of FIN 48 to
the Company, and has determined that the adoption of FIN 48 did not have a
material impact on the Company's financial statements. The Company files U.S.
and various state tax returns. No income tax returns are currently under
examination. The statutes of limitations on the Company's tax returns remains
open for the years ended March 31, 2005 through March 31, 2007. The impact on
the Company's state tax returns may remain open for an additional year depending
upon the jurisdiction.
In September 2006, Statement of Financial Accounting Standards No. 157, "Fair
Value Measurements" ("FAS 157"), was issued and is effective for fiscal years
beginning after November 15, 2007. FAS 157 defines fair value, establishes a
framework for measuring fair value and expands disclosures about fair value
measurements. At this time, management is evaluating the implications of FAS 157
and its impact on the Company's financial statements, if any, is currently being
assessed.
In addition, in February 2007, Statement of Financial Accounting Standards No.
159, "The Fair Value Option for Financial Assets and Financial Liabilities"
("FAS 159"), was issued and is effective for fiscal years beginning after
November 15, 2007. FAS 159 permits entities to choose to measure many financial
instruments and certain other items at fair value that are not currently
required to be measured at fair value. FAS 159 also establishes presentation and
disclosure requirements designed to facilitate comparisons between entities that
choose different measurement attributes for similar types of assets and
liabilities. At this time, management is evaluating the implications of FAS 159
and its impact on the Company's financial statements, if any, is currently being
assessed.
Offering Costs: Offering costs associated with the ongoing sale of the Company's
Units are expensed as incurred.
BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008 11
Notes to Financial Statements (continued)
2. Investment Advisory Agreement and Transactions with Affiliates:
The Company has entered into an Investment Advisory Agreement with BlackRock
Advisors, LLC ("BlackRock"). Merrill Lynch & Co., Inc. ("Merrill Lynch") and The
PNC Financial Service Group, Inc. are principal owners of BlackRock, Inc.
On October 1, 2007, BlackRock and BAA Holdings, LLC ("BAA"), a wholly owned
subsidiary of BlackRock, completed the acquisition of the fund of funds business
of Quellos Holdings, LLC ("Quellos"). The Combined fund of funds platform of
BlackRock, including the portion acquired from Quellos, will operate under the
name of BlackRock Alternative Advisors. The Company's Investment Advisory
Agreement with BlackRock did not change as a result of the acquisition. No
changes have occurred to the Company's investment objective or to the Company's
structure as a result of these changes.
BlackRock is responsible for the management of the Company's portfolio and
provides the necessary personnel, facilities, equipment and certain other
services necessary to the operations of the Company. For such services, the
Company pays BlackRock a monthly fee at an annual rate of 1.50% of the average
daily value of the Company's net assets.
The Company has also entered into a Member Services Agreement with FAM
Distributors, Inc. ("FAMD" or "Service Agent"), a subsidiary of Merrill Lynch.
FAMD provides or arranges for provision of ongoing investor and shareholder
servicing. The Company pays a monthly fee computed at the annual rate of 0.25%
of the Company's average month-end assets (the "Service Fee") to certain
affiliates of the Company, who in turn, pay the Service Agent for payments it
makes to broker-dealers and financial advisors that have agreed to provide
ongoing investor and shareholder servicing to Members of the Company and for
ongoing investor servicing activities performed by the Service Agent.
For the year ended March 31, 2008, FAMD received $114,848 in sales charges on
sales of units in the Company.
Certain officers and/or Directors of the Company are officers and/or directors
of BlackRock and/or BlackRock, Inc. or its affiliates.
3. Investments:
Purchases and sales of investments for the year ended March 31, 2008 were
$29,050,000 and $42,788,793, respectively.
4. Capital Share Transactions:
An investor purchases Units in the Company and the Units are offered at their
net asset value. The minimum initial investment for each investor is $25,000
(net of any distribution fees) and the minimum additional investment is $10,000.
An investor's subscription for Units is irrevocable by the investor and will
generally require the investor to maintain its investment in the Company until
such time as the Company offers to repurchase the Units in a tender offering. No
member or other person holding Units acquired from a Member will have the right
to require the Company to redeem the Units. The Company may, from time to time,
repurchase Units from Members in accordance with written tenders by Members at
those times, in those amounts and on terms and conditions as the Board of
Directors may determine in its sole discretion. BlackRock expects that it will
recommend to the Board of Directors that the Company offer to repurchase Units
from Members quarterly on the last business day of March, June, September and
December.
Transactions in capital were as follows:
- -------------------------------------------------------------------------------
Year Ended March 31, 2008 Units Amount
- -------------------------------------------------------------------------------
Units sold ....................................... 7,056,636 $ 8,407,988
Units tendered ................................... (22,957,742) (27,354,135)
--------------------------
Net decrease ..................................... (15,901,106) $(18,946,147)
==========================
- -------------------------------------------------------------------------------
Year Ended March 31, 2007 Units Amount
- -------------------------------------------------------------------------------
Units sold ....................................... 20,657,258 $ 22,515,567
Units tendered ................................... (27,471,409) (30,548,590)
--------------------------
Net decrease ..................................... (6,814,151) $ (8,033,023)
==========================
The Company is currently closed to new subscriptions.
5. Investments in Portfolio Funds:
The following table lists the Company's investments in Portfolio Funds for the
year ended March 31, 2008, none of which was a related party. The agreements
related to investments in Portfolio Funds provide for the compensation in the
form of management fees of 1% to 4% (per annum) of net assets and performance
incentive fees or allocations of 20% to 25% of net profits earned.
Complete information about the underlying investments held by the Portfolio
Funds is not readily available, so it is unknown whether the Portfolio Funds
hold any single investment whereby the Company's proportionate share exceeds 5%
of the Company's net assets at March 31, 2008.
12 BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008
Notes to Financial Statements (concluded)
- ------------------------------------------------------------------------------------------------------------------------------------
Fees
% of Company's Net Income --------------------- Redemptions
Investments Total Fair Value Fair Value (Loss) Management Incentive Permitted
- ------------------------------------------------------------------------------------------------------------------------------------
Aristeia Partners LP 7.5% $ 7,802,191 $ 480,104 1% 20% Quarterly
ARX Global High Yield Securities Fund I LP 8.2 8,638,351 (776,574) 1.75 20 Quarterly
Bayswater Global Quant Alpha Fund LLC -- (e) -- (e) (1,259,932) 2 20 Monthly
Campbell -- (f) -- (f) (668,365) 2 20 Monthly
Cornerstone International -- (f) -- (f) (927,289) 1 20 Monthly
Crabel Fund LP 7.6 8,018,219 468,219 3.5 20 Monthly
Double Black Diamond LP 6.1 6,418,637 938,374 1 - 1.5 20 Quarterly
FORT Global Contrarian LP 4.2 4,400,733 344,514 2 20 Monthly
Glenview Institutional Partners LP 8.1 8,428,211 437,383 2 20 Quarterly
GoldenTree Credit Opportunities -- (b) -- (b) 7,755 2 20 Semi-Annually
Grinham Diversified Fund (U.S.) LP 7.1 7,443,405 1,422,453 1.5 20 Monthly
Grossman Currency -- (c) -- (c) 40,069 2.5 25 Monthly
Gruss Global Investors LP 2.4 2,472,203 (27,797) 1.5 20 Quarterly
Hayground Cove Institutional Partners LP 5.4 5,682,155 (537,293) 1.5 20 Monthly
Ishin Fund LLC 4.2 4,352,341 (147,658) 1.5 20 Quarterly
Kinetics Partners LP 5.6 5,862,061 (9,572) 1 20 Monthly
Kottke Arbitrage -- (c) -- (c) (34,733) 2 20 Monthly
LibertyView Credit Opportunities Fund II LLC 7.7 8,035,136 (340,468) 1 20 Quarterly
Litespeed Partners -- (b) -- (b) 7,335 1.5 20 Quarterly
Martin Currie -- (g) -- (g) 7,221 1.5 20 Monthly
Maverick Levered -- (g) -- (g) 360,427 2 20 Quarterly
Neon Liberty Emerging Markets Fund LP 2.9 3,002,702 (48,440) 1.5 20 Quarterly
Salem Futures -- (c) -- (c) 127,388 2 20 Monthly
SR Capital -- (a) -- (a) 1,304 1 20 Quarterly
SR Phoenicia LP 6.7 7,030,870 1,071,121 1 20 Monthly
Suttonbrook Capital Partners LP 8.8 9,257,298 (699,357) 2 20 Monthly
Trivium Onshore Fund LP 7.5 7,819,060 (571,299) 1.5 20 Monthly
Ventus US$ -- (d) -- (d) (571,483) 4 20 Monthly
-------------------------------------------
Total 100.0% $104,663,573 $ (906,593)
===========================================
(a) The Company fully redeemed from the Portfolio Fund as of April 30, 2006.
(b) The Company fully redeemed from the Portfolio Fund as of December 31,
2006.
(c) The Company fully redeemed from the Portfolio Fund as of April 30, 2007.
(d) The Company fully redeemed from the Portfolio Fund as of October 31, 2007.
(e) The Company fully redeemed from the Portfolio Fund as of December 31,
2007.
(f) The Company fully redeemed from the Portfolio Fund as of January 31, 2008.
(g) The Company fully redeemed from the Portfolio Fund as of March 31, 2008.
6. Short-Term Borrowings:
The Company, along with another BlackRock registered investment company,
BlackRock Multi-Strategy Hedge Advantage, has jointly entered into a $20,000,000
revolving credit agreement with Citibank, N.A. Amounts borrowed under the credit
agreement bear interest at a rate equal to, at the Company's election, the
federal funds rate plus 1.25% or a base rate, as defined in the credit agreement
or the Eurodollar rate plus 1.25%. Through March 31, 2008, the Company had
weighted average borrowings of $111,749. The interest rate on borrowings for the
year ended March 31, 2008 was 6.52%. The Company had no loans outstanding as of
March 31, 2008.
7. Risk Factors:
An investment in the Company involves a high degree of risk, including the risk
that the entire amount invested may be lost. The Company allocates assets to
Portfolio Managers and invests in Portfolio Funds that invest in and actively
trade securities and other financial instruments using a variety of strategies
and investment techniques with significant risk characteristics, including the
risks arising from the volatility of the equity, fixed income, commodity and
currency markets, the risks of borrowings and short sales, the risks arising
from leverage associated with trading in the equities, currencies and
over-the-counter derivatives markets, the illiquidity of derivative instruments
and the risk of loss from counterparty defaults. No guarantee or representation
is made that the investment program will be successful.
BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008 13
Report of Independent Registered Public Accounting Firm
To the Members and Board of Directors of BlackRock Multi-Strategy Hedge
Opportunities LLC:
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of BlackRock Multi-Strategy Hedge Opportunities LLC
(the "Company") as of March 31, 2008, the related statements of operations and
cash flows for the year then ended, the statements of changes in net assets for
each of the two years in the period then ended, and the financial highlights for
each of the respective periods presented. These financial statements and
financial highlights are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. The
Company is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audits included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company's internal control
over financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of March 31, 2008, by correspondence with the financial
intermediaries. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
BlackRock Multi-Strategy Hedge Opportunities LLC as of March 31, 2008, the
results of its operations and its cash flows for the year then ended, the
changes in the net assets for each of the two years in the period then ended,
and the financial highlights for each of the respective periods presented, in
conformity with accounting principles generally accepted in the United States of
America.
As explained in Note 1 to the financial statements, the financial statements
include investments valued at $104,663,573, whose fair values have been
estimated by management in the absence of readily determinable fair values.
Management's estimates are based on information provided by the portfolio fund
managers.
Deloitte & Touche LLP
Princeton, New Jersey
May 28, 2008
14 BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008
Officers and Directors
Number of
Length of BlackRock-
Position(s) Time Advised Funds
Name, Address Held with Served as Principal Occupation(s) During and Portfolios Public
and Year of Birth Company a Director** Past Five Years Overseen Directorships
====================================================================================================================================
Non-Interested Directors*
- ------------------------------------------------------------------------------------------------------------------------------------
G. Nicholas Beckwith, III Director Since 2007 Chairman and Chief Executive 112 Funds None
40 East 52nd Street Officer, Arch Street Management, LLC 109 Portfolios
New York, NY 10022 (Beckwith Family Foundation) and
1945 various Beckwith property companies
since 2005; Chairman of the Board of
Directors, University of Pittsburgh
Medical Center since 2002; Board of
Directors, Shady Side Hospital
Foundation since 1977; Board of
Directors, Beckwith Institute for
Innovation In Patient Care since
1991; Member, Advisory Council on
Biology and Medicine, Brown
University since 2002; Trustee,
Claude Worthington Benedum
Foundation (charitable foundation)
since 1989; Board of Trustees,
Chatham College since 1981; Board of
Trustees, University of Pittsburgh
since 2002; Emeritus Trustee, Shady
Side Academy since 1977; Formerly
Chairman and Manager, Penn West
Industrial Trucks LLC (sales, rental
and servicing of material handling
equipment) from 2005 to 2007;
Formerly Chairman, President and
Chief Executive Officer, Beckwith
Machinery Company (sales, rental and
servicing of construction and
equipment) from 1985 to 2005;
Formerly Board of Directors,
National Retail Properties (REIT)
from 2006 to 2007.
- ------------------------------------------------------------------------------------------------------------------------------------
Richard E. Cavanagh Director and Since 2007 Trustee, Aircraft Finance Trust 113 Funds Arch Chemical
40 East 52nd Street Chair of since 1999; Director, The Guardian 110 Portfolios (chemical and allied
New York, NY 10022 the Board Life Insurance Company of America products)
1946 of Directors since 1998; Chairman and Trustee,
Educational Testing Service since
1997; Director, The Fremont Group
since 1996; Formerly President and
Chief Executive Officer of The
Conference Board, Inc. (global
business research organization) from
1995 to 2007.
- ------------------------------------------------------------------------------------------------------------------------------------
Kent Dixon Director and Since 2007 Consultant/Investor since 1988. 113 Funds None
40 East 52nd Street Member of 110 Portfolios
New York, NY 10022 the Audit
1937 Committee
- ------------------------------------------------------------------------------------------------------------------------------------
Frank J. Fabozzi Director and Since 2007 Consultant/Editor of The Journal of 113 Funds None
40 East 52nd Street Member of Portfolio Management since 2006; 110 Portfolios
New York, NY 10022 the Audit Professor in the Practice of Finance
1948 Committee and Becton Fellow, Yale University,
School of Management since 2006;
Formerly Adjunct Professor of
Finance and Becton Fellow, Yale
University from 1994 to 2006.
- ------------------------------------------------------------------------------------------------------------------------------------
Kathleen F. Feldstein Director Since 2007 President of Economics Studies, Inc. 113 Funds The McClatchy
40 East 52nd Street (private economic consulting firm) 110 Portfolios Company
New York, NY 10022 since 1987; Chair, Board of (publishing)
1941 Trustees, McLean Hospital since
2000; Member of the Board of
Partners Community Healthcare, Inc.
since 2005; Member of the Board of
Partners HealthCare since 1995;
Member of the Board of Sherrill
House (health care) since 1990;
Trustee, Museum of Fine Arts, Boston
since 1992; Member of the Visiting
Committee to the Harvard University
Art Museum since 2003; Trustee, The
Committee for Economic Development
(research organization) since 1990;
Member of the Advisory Board to the
International School of Business,
Brandeis University since 2002;
Formerly Director of Bell South
(communications) from 1998 to 2006;
Formerly Director of Ionics (water
purification) from 1992 to 2005;
Formerly Director of John Hancock
Financial Services from 1994 to
2003; Formerly Director of Knight
Ridder (media) from 1998 to 2006.
- ------------------------------------------------------------------------------------------------------------------------------------
James T. Flynn Director and Since 2005 Formerly Chief Financial Officer of 112 Funds None
40 East 52nd Street Member of JPMorgan & Co., Inc. from 1990 109 Portfolios
New York, NY 10022 the Audit to 1995.
1939 Committee
- ------------------------------------------------------------------------------------------------------------------------------------
BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008 15
Officers and Directors (continued)
Number of
Length of BlackRock-
Position(s) Time Advised Funds
Name, Address Held with Served as Principal Occupation(s) During and Portfolios Public
and Year of Birth Company a Director** Past Five Years Overseen Directorships
====================================================================================================================================
Non-Interested Directors* (concluded)
- ------------------------------------------------------------------------------------------------------------------------------------
Jerrold B. Harris Director Since 2007 Trustee, Ursinus College since 2000; 112 Funds BlackRock Kelso
40 East 52nd Street Director, Troemner LLC (scientific 109 Portfolios Capital Corp.
New York, NY 10022 equipment) since 2000.
1942
- ------------------------------------------------------------------------------------------------------------------------------------
R. Glenn Hubbard Director Since 2007 Dean of Columbia Business School 113 Funds ADP (data and
40 East 52nd Street since 2004; Columbia faculty member 110 Portfolios information services);
New York, NY 10022 since 1988; Formerly Co-Director of KKR Financial
1958 Columbia Business School's Corporation (finance);
Entrepreneurship Program from 1997 Duke Realty (real
to 2004; Visiting Professor at the estate); Metropolitan
John F. Kennedy School of Government Life Insurance
at Harvard University and the Company (insurance);
Harvard Business School since 1985 Information
and at the University of Chicago Services Group
since 1994; Formerly Chairman of the (media/technology)
U.S. Council of Economic Advisers
under the President of the United
States from 2001 to 2003.
- ------------------------------------------------------------------------------------------------------------------------------------
W. Carl Kester Director and Since 2005 Mizuho Financial Group Professor of 112 Funds None
40 East 52nd Street Member of Finance, Harvard Business School; 109 Portfolios
New York, NY 10022 the Audit Deputy Dean for Academic Affairs
1951 Committee since 2006; Unit Head, Finance,
Harvard Business School from 2005 to
2006; Senior Associate Dean and
Chairman of the MBA Program of
Harvard Business School from 1999 to
2005; Member of the faculty of
Harvard Business School since 1981;
Independent Consultant since 1978.
- ------------------------------------------------------------------------------------------------------------------------------------
Karen P. Robards Director and Since 2005 Partner of Robards & Company, LLC, 112 Funds AtriCure, Inc.
40 East 52nd Street Chair of (financial advisory firm) since 109 Portfolios (medical devices);
New York, NY 10022 the Audit 1987; Co-founder and Director of the Care Investment Trust,
1950 Committee Cooke Center for Learning and Inc. (health care
Development (a not-for-profit REIT)
organization) since 1987; Formerly
Director of Enable Medical Corp.
from 1996 to 2005; Formerly an
investment banker at Morgan Stanley
from 1976 to 1987.
- ------------------------------------------------------------------------------------------------------------------------------------
Robert S. Salomon, Jr. Director and Since 2007 Formerly Principal of STI Management 112 Funds None
40 East 52nd Street Member of LLC (investment adviser) from 1994 109 Portfolios
New York, NY 10022 the Audit to 2005.
1936 Committee
---------------------------------------------------------------------------------------------------------
* Directors serve until their resignation, removal or death, or until December 31 of the year in which
they turn 72.
** Following the combination of Merrill Lynch Investment Managers, L.P. ("MLIM") and BlackRock, Inc.
("BlackRock") in September 2006, the various legacy MLIM and legacy BlackRock Fund boards were
realigned and consolidated into three new Fund boards in 2007. As a result, although the chart shows
certain directors as joining the Company's board in 2007, those directors first became a member of
the board of directors of other legacy MLIM or legacy BlackRock Funds as follows: G. Nicholas
Beckwith, III since 1999; Richard E. Cavanagh since 1994; Kent Dixon since 1988; Frank J. Fabozzi
since 1988; Kathleen F. Feldstein since 2005; James T. Flynn since 1996; Jerrold B. Harris since
1999; R. Glenn Hubbard since 2004; W. Carl Kester since 1998; Karen P. Robards since 1998 and Robert
S. Salomon, Jr. since 1996.
16 BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008
Officers and Directors (continued)
Number of
Length of BlackRock-
Position(s) Time Advised Funds
Name, Address Held with Served as Principal Occupation(s) During and Portfolios Public
and Year of Birth Company a Director Past Five Years Overseen Directorships
====================================================================================================================================
Interested Directors*
- ------------------------------------------------------------------------------------------------------------------------------------
Richard S. Davis Director Since 2007 Managing Director, BlackRock, Inc. 185 Funds None
40 East 52nd Street since 2005; Formerly Chief Executive 292 Portfolios
New York, NY 10022 Officer, State Street Research &
1945 Management Company from 2000 to
2005; Formerly Chairman of the Board
of Trustees, State Street Research
Mutual Funds from 2000 to 2005;
Formerly Chairman, SSR Realty from
2000 to 2004.
- ------------------------------------------------------------------------------------------------------------------------------------
Henry Gabbay Director Since 2007 Consultant, BlackRock, Inc. since 184 Funds None
40 East 52nd Street 2007; Formerly Managing Director, 291 Portfolios
New York, NY 10022 BlackRock, Inc. from 1989 to 2007;
1947 Formerly Chief Administrative
Officer, BlackRock Advisors, LLC
from 1998 to 2007; Formerly
President of BlackRock Funds and
BlackRock Bond Allocation Target
Shares from 2005 to 2007; Formerly
Treasurer of certain closed-end
funds in the BlackRock fund complex
from 1989 to 2006.
---------------------------------------------------------------------------------------------------------
* Messrs. Davis and Gabbay are both "interested persons," as defined in the Investment Company Act
of 1940, of the Company based on their positions with BlackRock, Inc. and its affiliates.
BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008 17
Officers and Directors (concluded)
Position(s) Length of
Name, Address Held with Time
and Year of Birth the Company Served Principal Occupation(s) During Past Five Years
====================================================================================================================================
Officers*
- ------------------------------------------------------------------------------------------------------------------------------------
Donald C. Burke Company Since 2007 Managing Director of BlackRock, Inc. since 2006; Formerly Managing Director
40 East 52nd Street President of Merrill Lynch Investment Managers, L.P. ("MLIM") and Fund Asset
New York, NY 10022 and Chief Management, L.P. ("FAM") in 2006; First Vice President thereof from 1997 to
1960 Executive 2005; Treasurer thereof from 1999 to 2006 and Vice President thereof from
Officer 1990 to 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
Anne F. Ackerley Vice Since 2007 Managing Director of BlackRock, Inc. since 2000 and First Vice President and
40 East 52nd Street President Chief Operating Officer of Mergers and Acquisitions Group from 1997 to 2000;
New York, NY 10022 First Vice President and Chief Operating Officer of Public Finance Group
1962 thereof from 1995 to 1997; First Vice President of Emerging Markets Fixed
Income Research of Merrill Lynch & Co., Inc. from 1994 to 1995.
- ------------------------------------------------------------------------------------------------------------------------------------
Neal J. Andrews Chief Since 2007 Managing Director of BlackRock, Inc. since 2006; Formerly Senior Vice
40 East 52nd Street Financial President and Line of Business Head of Fund Accounting and Administration at
New York, NY 10022 Officer PFPC Inc. from 1992 to 2006.
1966
- ------------------------------------------------------------------------------------------------------------------------------------
Jay M. Fife Treasurer Since 2007 Managing Director of BlackRock, Inc. since 2007 and Director in 2006;
40 East 52nd Street Formerly Assistant Treasurer of the MLIM/FAM advised funds from 2005 to
New York, NY 10022 2006; Director of MLIM Fund Services Group from 2001 to 2006.
1970
- ------------------------------------------------------------------------------------------------------------------------------------
Brian P. Kindelan Chief Since 2007 Chief Compliance Officer of the Funds since 2007; Anti-Money Laundering
40 East 52nd Street Compliance Officer of the Funds since 2007; Managing Director and Senior Counsel
New York, NY 10022 Officer of thereof since 2005; Director and Senior Counsel of BlackRock Advisors, Inc.
1959 the Funds 2001 to 2004 and Vice President and Senior Counsel thereof from 1998 to
2000; Senior Counsel of The PNC Bank Corp. from 1995 to 1998.
- ------------------------------------------------------------------------------------------------------------------------------------
Howard Surloff Secretary Since 2007 Managing Director of BlackRock, Inc. and General Counsel of U.S. Funds at
40 East 52nd Street BlackRock, Inc. since 2006; Formerly General Counsel (U.S.) of Goldman Sachs
New York, NY 10022 Asset Management, L.P. from 1993 to 2006.
1965
---------------------------------------------------------------------------------------------------------
* Officers of the Company serve at the pleasure of the Board of Directors.
- ------------------------------------------------------------------------------------------------------------------------------------
Custodian
PFPC Trust Company
Philadelphia, PA 19153
Administrator &
Escrow Agent
PFPC Inc.
Wilmington, DE 19809
Independent Registered Public
Accounting Firm
Deloitte & Touche LLP
Princeton, NJ 08540
Legal Counsel
Skadden, Arps, Slate,
Meagher & Flom LLP
New York, NY 10036
18 BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008
Additional Information
Availability of Quarterly Schedule of Investments
The Company files its complete schedule of portfolio holdings with the
Securities and Exchange Commission ("SEC") for the first and third quarters of
each fiscal year on Form N-Q. The Company's Forms N-Q are available on the SEC's
website at http://www.sec.gov and may also be reviewed and copied at the SEC's
Public Reference Room in Washington, DC. Information on the operation of the
Public Reference Room may be obtained by calling (800) SEC-0330. The Company's
Forms N-Q may also be obtained upon request and without charge by calling (800)
441-7762.
Electronic Delivery
Electronic copies of most financial reports are available on the Company's
website or shareholders can sign up for e-mail notifications of quarterly
statements, annual and semi-annual reports by enrolling in the Company's
electronic delivery program.
Shareholders Who Hold Accounts with Investment Advisors, Banks or Brokerages:
Please contact your financial advisor to enroll. Please note that not all
investment advisors, banks or brokerages may offer this service.
General Information
During the period, there were no material changes in the Company's investment
objective or policies or to the Company's charter or by-laws that were not
approved by the shareholders or in the principal risk factors associated with
investment in the Company. There have been no changes in the persons who are
primarily responsible for the day-to-day management of the Company's portfolio.
BlackRock Privacy Principles
BlackRock is committed to maintaining the privacy of its current and former fund
investors and individual clients (collectively, "Clients") and to safeguarding
their non-public personal information. The following information is provided to
help you understand what personal information BlackRock collects, how we protect
that information and why in certain cases we share such information with select
parties.
If you are located in a jurisdiction where specific laws, rules or regulations
require BlackRock to provide you with additional or different privacy-related
rights beyond what is set forth below, then BlackRock will comply with those
specific laws, rules or regulations.
BlackRock obtains or verifies personal non-public information from and about you
from different sources, including the following: (i) information we receive from
you or, if applicable, your financial intermediary, on applications, forms or
other documents; (ii) information about your transactions with us, our
affiliates, or others; (iii) information we receive from a consumer reporting
agency; and (iv) from visits to our websites.
BlackRock does not sell or disclose to non-affiliated third parties any
non-public personal information about its Clients, except as permitted by law or
as is necessary to respond to regulatory requests or to service Client accounts.
These non-affiliated third parties are required to protect the confidentiality
and security of this information and to use it only for its intended purpose.
We may share information with our affiliates to service your account or to
provide you with information about other BlackRock products or services that may
be of interest to you. In addition, BlackRock restricts access to non-public
personal information about its Clients to those BlackRock employees with a
legitimate business need for the information. BlackRock maintains physical,
electronic and procedural safeguards that are designed to protect the non-public
personal information of its Clients, including procedures relating to the proper
storage and disposal of such information.
BLACKROCK MULTI-STRATEGY HEDGE OPPORTUNITIES LLC MARCH 31, 2008 19
This report is not authorized for use as an offer of sale or a solicitation of
an offer to buy units of the Company unless accompanied or preceded by the
Company's current prospectus. Past performance results shown in this report
should not be considered a representation of future performance. Statements and
other information herein are as dated and are subject to change.
Information about how the Company voted proxies relating to securities held in
the Company's portfolio during the most recent 12-month period ended June 30 is
available upon request and without charge (1) by calling (800) 441-7762 and (2)
on the Securities and Exchange Commission's website at http://www.sec.gov.
BlackRock Multi-Strategy Hedge Opportunities LLC
100 Bellevue Parkway
Wilmington, DE 19809
BLACKROCK
#MHO-3/08
Item 2 - Code of Ethics - The registrant (or the "Fund") has adopted a code
of ethics, as of the end of the period covered by this report,
applicable to the registrant's principal executive officer,
principal financial officer and principal accounting officer, or
persons performing similar functions. During the period covered by
this report, there have been no amendments to or waivers granted
under the code of ethics. A copy of the code of ethics is available
without charge at www.blackrock.com.
Item 3 - Audit Committee Financial Expert - The registrant's board of
directors or trustees, as applicable (the "board of directors") has
determined that (i) the registrant has the following audit committee
financial experts serving on its audit committee and (ii) each audit
committee financial expert is independent:
David O. Beim (term ended effective November 1, 2007)
Kent Dixon (term began effective November 1, 2007)
Frank J. Fabozzi (term began effective November 1, 2007)
James T. Flynn
W. Carl Kester
Karen P. Robards
Robert S. Salomon, Jr. (term began effective November 1, 2007)
The registrant's board of directors has determined that W. Carl
Kester and Karen P. Robards qualify as financial experts pursuant to
Item 3(c)(4) of Form N-CSR.
Prof. Kester has a thorough understanding of generally accepted
accounting principles, financial statements and internal control
over financial reporting as well as audit committee functions. Prof.
Kester has been involved in providing valuation and other financial
consulting services to corporate clients since 1978. Prof. Kester's
financial consulting services present a breadth and level of
complexity of accounting issues that are generally comparable to the
breadth and complexity of issues that can reasonably be expected to
be raised by the registrant's financial statements.
Ms. Robards has a thorough understanding of generally accepted
accounting principles, financial statements and internal control
over financial reporting as well as audit committee functions. Ms.
Robards has been President of Robards & Company, a financial
advisory firm, since 1987. Ms. Robards was formerly an investment
banker for more than 10 years where she was responsible for
evaluating and assessing the performance of companies based on their
financial results. Ms. Robards has over 30 years of experience
analyzing financial statements. She also is a member of the audit
committee of one publicly held company and a non-profit
organization.
Under applicable securities laws, a person determined to be an audit
committee financial expert will not be deemed an "expert" for any
purpose, including without limitation for the purposes of Section 11
of the Securities Act of 1933, as a result of being designated or
identified as an audit committee financial expert. The designation
or identification as an audit committee financial expert does not
impose on such person any duties, obligations, or liabilities
greater than the duties, obligations, and liabilities imposed on
such person as a member of the audit committee and board of
directors in the absence of such designation or identification.
Item 4 - Principal Accountant Fees and Services
- ----------------------------------------------------------------------------------------------------------------------------------
(a) Audit Fees (b) Audit-Related Fees(1) (c) Tax Fees(2) (d) All Other Fees(3)
- ----------------------------------------------------------------------------------------------------------------------------------
Current Previous Current Previous Current Previous Current Previous
Fiscal Year Fiscal Fiscal Year Fiscal Fiscal Year Fiscal Fiscal Year Fiscal
Entity Name End Year End End Year End End Year End End Year End
- ----------------------------------------------------------------------------------------------------------------------------------
BlackRock
Multi-Strategy
Hedge
Opportunities, LLC $35,000 $31,000 $0 $0 $68,000 $45,000 $1,049 $0
- ----------------------------------------------------------------------------------------------------------------------------------
1 The nature of the services include assurance and related services reasonably
related to the performance of the audit of financial statements not included in
Audit Fees.
2 The nature of the services include tax compliance, tax advice and tax
planning.
3 The nature of the services include a review of compliance procedures and
attestation thereto.
(e)(1) Audit Committee Pre-Approval Policies and Procedures:
The registrant's audit committee (the "Committee") has adopted
policies and procedures with regard to the pre-approval of services.
Audit, audit-related and tax compliance services provided to the
registrant on an annual basis require specific pre-approval by the
Committee. The Committee also must approve other non-audit services
provided to the registrant and those non-audit services provided to
the registrant's affiliated service providers that relate directly
to the operations and the financial reporting of the registrant.
Certain of these non-audit services that the Committee believes are
a) consistent with the SEC's auditor independence rules and b)
routine and recurring services that will not impair the independence
of the independent accountants may be approved by the Committee
without consideration on a specific case-by-case basis ("general
pre-approval"). The term of any general pre-approval is 12 months
from the date of the pre-approval, unless the Committee provides for
a different period. Tax or other non-audit services provided to the
registrant which have a direct impact on the operation or financial
reporting of the registrant will only be deemed pre-approved
provided that any individual project does not exceed $10,000
attributable to the registrant or $50,000 for all of the registrants
the Committee oversees. For this purpose, multiple projects will be
aggregated to determine if they exceed the previously mentioned cost
levels.
Any proposed services exceeding the pre-approved cost levels
will require specific pre-approval by the Committee, as will any
other services not subject to general pre-approval (e.g.,
unanticipated but permissible services). The Committee is informed
of each service approved subject to general pre-approval at the next
regularly scheduled in-person board meeting. At this meeting, an
analysis of such services is presented to the Committee for
ratification. The Committee may delegate to one or more of its
members the authority to approve the provision of and fees for any
specific engagement of permitted non-audit services, including
services exceeding pre-approved cost levels.
(e)(2) None of the services described in each of Items 4(b) through
(d) were approved by the audit committee pursuant to paragraph
(c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) Not Applicable
(g) Affiliates' Aggregate Non-Audit Fees:
--------------------------------------------------------------------
Current Fiscal Previous Fiscal
Entity Name Year End Year End
--------------------------------------------------------------------
BlackRock Multi-Strategy
Hedge Opportunities, LLC $288,549 $3,059,500
--------------------------------------------------------------------
(h) The registrant's audit committee has considered and determined
that the provision of non-audit services that were rendered to the
registrant's investment adviser (not including any non-affiliated
sub-adviser whose role is primarily portfolio management and is
subcontracted with or overseen by the registrant's investment
adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services
to the registrant that were not pre-approved pursuant to paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with
maintaining the principal accountant's independence.
Regulation S-X Rule 2-01(c)(7)(ii) - $287,500, 0%
Item 5 - Audit Committee of Listed Registrants - The following individuals
are members of the registrant's separately-designated standing audit
committee established in accordance with Section 3(a)(58)(A) of the
Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(58)(A)):
David O. Beim (term ended effective November 1, 2007)
Kent Dixon (term began effective November 1, 2007)
Frank J. Fabozzi (term began effective November 1, 2007)
James T. Flynn
W. Carl Kester
Karen P. Robards
Robert S. Salomon, Jr. (term began effective November 1, 2007)
Item 6 - Investments
(a) The registrant's Schedule of Investments is included as part of
the Report to Stockholders filed under Item 1 of this form.
(b) Not Applicable due to no such divestments during the semi-annual
period covered since the previous Form N-CSR filing.
Item 7 - Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies - The registrant has delegated the
voting of proxies relating to Fund portfolio securities to its
investment adviser, BlackRock Advisors, LLC and its sub-adviser, as
applicable. The Proxy Voting Policies of the Fund are attached
hereto as Exhibit 99.PROXYPOL.
Information about how the Fund voted proxies relating to securities
held in the Fund's portfolio during the most recent 12 month period
ended June 30 is available without charge (1) at www.blackrock.com
and (2) on the Commission's web site at http://www.sec.gov.
Item 8 - Portfolio Managers of Closed-End Management Investment Companies -
as of March 31, 2008.
(a)(1) The BlackRock Fund of Funds Team is responsible for managing
the Fund's investments. Howard P. Berkowitz, Christine Jurinich
and Edward Rzeszowski are the portfolio managers responsible for
investing the Company's assets. Mr. Berkowitz is the head of the
team and is responsible for overseeing the management of the
Company's investments. Ms. Jurinich is responsible for evaluating
potential Portfolio Fund Managers and monitoring existing Portfolio
Fund Managers, and Mr. Rzeszowski is responsible for evaluating
potential Portfolio Fund Managers and monitoring existing Portfolio
Fund Managers with a focus on managed futures, macro funds and
statistical arbitrage.
Mr. Berkowitz is a Managing Director of BlackRock and a member of
BlackRock's Management Committee. Mr. Berkowitz has more than 35
years of experience running private investment funds and funds of
hedge funds. He joined BlackRock in April 2003 and has been the
Company's portfolio manager since 2006. Prior to joining BlackRock,
Mr. Berkowitz was the founder and managing partner of HPB Associates
which he initially formed in 1979 as a traditional equity hedge
fund. In 1967, Mr. Berkowitz co-founded and managed Steinhardt,
Fine, Berkowitz & Co., one of the earliest and most highly
successful entrants into the hedge fund industry.
Ms. Jurinich is a Managing Director of BlackRock and has been a
member of the portfolio management team since 2003. Before taking on
her current responsibilities in 2003, Ms. Jurinich was a member of
the Account Management Group where she was responsible for
developing and maintaining relationships with non-U.S. clients and
for developing alternative investment products. Prior to joining
BlackRock in 2002, Ms. Jurinich was responsible for investor
relations and hedge fund research at Victus Capital LLC. From 2000
to 2001, she was responsible for manager research and
recommendations relating to relative value managers at Alpha
Investment Management LLC. She spent the prior year with Arista
Group, where her duties included all aspects of due diligence and
performance reporting. Ms. Jurinich began her career in 1993 with
Allied Capital Asset Management.
Mr. Rzeszowski is a Managing Director of BlackRock and joined
BlackRock in 2006 as a member of the Fund of Fund's team and became
part of the Company's portfolio management team at that time. Prior
to joining BlackRock, Mr. Rzeszowski was a Director with the fund of
funds team of MLIM LP. In this role, he was responsible for the
selection and analysis of hedge funds with a focus on managed
futures, macro funds and statistical arbitrage, and served as senior
hedge fund analyst and portfolio manager for the Global Horizons I,
L.P. and ML Global Horizons Ltd. Previously, Mr. Rzeszowski was a
Senior Quantitative Analyst for the MLIM LP fund of funds team,
responsible for risk management of the managed futures product line.
He has held various positions in MLIM LP's finance department. His
additional previous work experience includes OMR Systems Corporation
(a financial investments service company), where he was responsible
for the consolidation of managed futures risks.
(a)(2) As of March 31, 2008:
-----------------------------------------------------------------------------------------------------------------------
(iii) Number of Other Accounts and
(ii) Number of Other Accounts Managed Assets for Which Advisory Fee is
and Assets by Account Type Performance-Based
-----------------------------------------------------------------------------------------------------------------------
Other Other Other Other
(i) Name of Registered Pooled Registered Pooled
Portfolio Investment Investment Other Investment Investment Other
Manager Companies Vehicles Accounts Companies Vehicles Accounts
-----------------------------------------------------------------------------------------------------------------------
Howard P.
Berkowitz 1 35 7 0 18 4
-----------------------------------------------------------------------------------------------------------------------
$106 Million $2.53 Billion $616.2 Million $0 $1.05 Billion $474.8 Million
-----------------------------------------------------------------------------------------------------------------------
Christine
Jurinich 1 35 7 0 18 4
-----------------------------------------------------------------------------------------------------------------------
$106 Million $2.53 Billion $616.2 Million $0 $1.05 Billion $474.8 Million
-----------------------------------------------------------------------------------------------------------------------
Edward
Rzeszowski 1 35 7 0 18 4
-----------------------------------------------------------------------------------------------------------------------
$106 Million $2.53 Billion $616.2 Million $0 $1.05 Billion $474.8 Million
-----------------------------------------------------------------------------------------------------------------------
(iv) Potential Material Conflicts of Interest
BlackRock, Inc. and its affiliates (collectively, herein
"BlackRock") has built a professional working environment, firm-wide
compliance culture and compliance procedures and systems designed to
protect against potential incentives that may favor one account over
another. BlackRock has adopted policies and procedures that address
the allocation of investment opportunities, execution of portfolio
transactions, personal trading by employees and other potential
conflicts of interest that are designed to ensure that all client
accounts are treated equitably over time. Nevertheless, BlackRock
furnishes investment management and advisory services to numerous
clients in addition to the Fund, and BlackRock may, consistent with
applicable law, make investment recommendations to other clients or
accounts (including accounts which are hedge funds or have
performance or higher fees paid to BlackRock, or in which portfolio
managers have a personal interest in the receipt of such fees),
which may be the same as or different from those made for the Fund.
In addition, BlackRock, its affiliates and any officer, director,
stockholder or employee may or may not have an interest in the
securities whose purchase and sale BlackRock recommends to the Fund.
BlackRock, or any of its affiliates, or any officer, director,
stockholder, employee or any member of their families may take
different actions than those recommended to the Fund by BlackRock
with respect to the same securities. Moreover, BlackRock may refrain
from rendering any advice or services concerning securities of
companies of which any of BlackRock's (or its affiliates') officers,
directors or employees are directors or officers, or companies as to
which BlackRock or any of its affiliates or the officers, directors
or employees of any of them has any substantial economic interest or
possesses material non-public information. Each portfolio manager
also may manage accounts whose investment strategies may at times be
opposed to the strategy utilized for a Fund. In this regard, it
should be noted that Mr. Berkowitz, Ms. Jurinich and Mr. Rzeszowksi
currently manage certain accounts that are subject to performance
fees. In addition, certain portfolio managers may assist in managing
certain hedge funds and may be entitled to receive a portion of any
incentive fees earned on such funds and a portion of such incentive
fees may be voluntarily or involuntarily deferred. Additional
portfolio managers may in the future manage other such accounts or
funds and may be entitled to receive incentive fees.
As a fiduciary, BlackRock owes a duty of loyalty to its clients and
must treat each client fairly. When BlackRock purchases or sells
securities for more than one account, the trades must be allocated
in a manner consistent with its fiduciary duties. BlackRock attempts
to allocate investments in a fair and equitable manner among client
accounts, with no account receiving preferential treatment. To this
end, BlackRock has adopted a policy that is intended to ensure that
investment opportunities are allocated fairly and equitably among
client accounts over time. This policy also seeks to achieve
reasonable efficiency in client transactions and provide BlackRock
with sufficient flexibility to allocate investments in a manner that
is consistent with the particular investment discipline and client
base.
(a)(3) As of March 31, 2008:
Portfolio Manager Compensation Overview
BlackRock's financial arrangements with its portfolio managers, its
competitive compensation and its career path emphasis at all levels
reflect the value senior management places on key resources.
Compensation may include a variety of components and may vary from
year to year based on a number of factors. The principal components
of compensation include a base salary, a performance-based
discretionary bonus, participation in various benefits programs and
one or more of the incentive compensation programs established by
BlackRock such as its Long-Term Retention and Incentive Plan and
Restricted Stock Program.
Base compensation. Generally, portfolio managers receive base
compensation based on their seniority and/or their position with the
firm. Senior portfolio managers who perform additional management
functions within the portfolio management group or within BlackRock
may receive additional compensation for serving in these other
capacities.
Discretionary Incentive Compensation
Discretionary incentive compensation is a function of several
components: the performance of BlackRock, Inc., the performance of
the portfolio manager's group within BlackRock, the investment
performance, including risk-adjusted returns, of the firm's assets
under management or supervision by that portfolio manager relative
to predetermined benchmarks, and the individual's seniority, role
within the portfolio management team, teamwork and contribution to
the overall performance of these portfolios and BlackRock. In most
cases, including for the portfolio managers of the Fund, these
benchmarks are the same as the benchmark or benchmarks against which
the performance of the Fund or other accounts managed by the
portfolio managers are measured. BlackRock's Chief Investment
Officers determine the benchmarks against which the performance of
funds and other accounts managed by each portfolio manager is
compared and the period of time over which performance is evaluated.
With respect to the portfolio managers, such benchmarks for the Fund
include a combination of market-based indices (e.g., HFRI Fund of
Funds Composite Index, HFRI Fund Weighted Composite Index), certain
customized indices and certain fund industry peer groups.
BlackRock's Chief Investment Officers make a subjective
determination with respect to the portfolio managers' compensation
based on the performance of the funds and other accounts managed by
each portfolio manager relative to the various benchmarks noted
above. Performance is measured on both a pre-tax basis over various
time periods including 1, 3 and 5-year periods, as applicable.
Distribution of Discretionary Incentive Compensation
Discretionary incentive compensation is distributed to portfolio
managers in a combination of cash and BlackRock, Inc. restricted
stock units which vest ratably over a number of years. The
BlackRock, Inc. restricted stock units, if properly vested, will be
settled in BlackRock, Inc. common stock. Typically, the cash bonus,
when combined with base salary, represents more than 60% of total
compensation for the portfolio managers. Paying a portion of annual
bonuses in stock puts compensation earned by a portfolio manager for
a given year "at risk" based on the Company's ability to sustain and
improve its performance over future periods.
Other compensation benefits. In addition to base compensation and
discretionary incentive compensation, portfolio managers may be
eligible to receive or participate in one or more of the following:
Long-Term Retention and Incentive Plan ("LTIP") --The LTIP is
a long-term incentive plan that seeks to reward certain key
employees. Prior to 2006, the plan provided for the grant of awards
that were expressed as an amount of cash that, if properly vested
and subject to the attainment of certain performance goals, will be
settled in cash and/or in BlackRock, Inc. common stock. Beginning in
2006, awards are granted under the LTIP in the form of BlackRock,
Inc. restricted stock units that, if properly vested and subject to
the attainment of certain performance goals, will be settled in
BlackRock, Inc. common stock. Each of Mr. Berkowitz, Ms. Jurinich
and Mr. Rzeszowski has received awards under the LTIP.
Deferred Compensation Program --A portion of the compensation
paid to eligible BlackRock employees may be voluntarily deferred
into an account that tracks the performance of certain of the firm's
investment products. Each participant in the deferred compensation
program is permitted to allocate his deferred amounts among various
options, including to certain of the firm's hedge funds and other
proprietary mutual funds. Each of Mr. Berkowitz, Ms. Jurinich and
Mr. Rzeszowski has participated in the deferred compensation
program.
Options and Restricted Stock Awards -- A portion of the annual
compensation of certain employees is mandatorily deferred into
BlackRock restricted stock units. Prior to the mandatory deferral
into restricted stock units, the Company granted stock options to
key employees, including certain portfolio managers who may still
hold unexercised or unvested options. BlackRock, Inc. also granted
restricted stock awards designed to reward certain key employees as
an incentive to contribute to the long-term success of BlackRock.
These awards vest over a period of years. Mr. Berkowitz has been
granted stock options and/or restricted stock in prior years.
Incentive Savings Plans -- BlackRock, Inc. has created a
variety of incentive savings plans in which BlackRock employees are
eligible to participate, including a 401(k) plan, the BlackRock
Retirement Savings Plan (RSP), and the BlackRock Employee Stock
Purchase Plan (ESPP). The employer contribution components of the
RSP include a company match equal to 50% of the first 6% of eligible
pay contributed to the plan capped at $4,000 per year, and a company
retirement contribution equal to 3% of eligible compensation, plus
an additional contribution of 2% for any year in which BlackRock has
positive net operating income. The RSP offers a range of investment
options, including registered investment companies managed by the
firm. Company contributions follow the investment direction set by
participants for their own contributions or, absent employee
investment direction, are invested into a balanced portfolio. The
ESPP allows for investment in BlackRock common stock at a 5%
discount on the fair market value of the stock on the purchase date.
Annual participation in the ESPP is limited to the purchase of 1,000
shares or a dollar value of $25,000. Each portfolio manager is
eligible to participate in these plans.
(a)(4) Beneficial Ownership of Securities. As of March 31, 2008,
none of Mr. Berkowitz, Ms. Jurinich or Mr. Rzeszowski
beneficially owned any stock issued by the Fund.
Item 9 - Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers - Not Applicable due to no such
purchases during the period covered by this report.
Item 10 - Submission of Matters to a Vote of Security Holders - The
registrant's Nominating and Governance Committee will consider
nominees to the Board recommended by shareholders when a vacancy
becomes available. Shareholders who wish to recommend a nominee
should send nominations which include biographical information and
set forth the qualifications of the proposed nominee to the
registrant's Secretary. There have been no material changes to these
procedures.
Item 11 - Controls and Procedures
11(a) - The registrant's principal executive and principal financial
officers or persons performing similar functions have concluded that
the registrant's disclosure controls and procedures (as defined in
Rule 30a-3(c) under the Investment Company Act of 1940, as amended
(the "1940 Act")) are effective as of a date within 90 days of the
filing of this report based on the evaluation of these controls and
procedures required by Rule 30a-3(b) under the 1940 Act and Rule
13a-15(b) under the Securities Exchange Act of 1934, as amended.
11(b) - There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act)
that occurred during the second fiscal quarter of the period covered
by this report that have materially affected, or are reasonably
likely to materially affect, the registrant's internal control over
financial reporting.
Item 12 - Exhibits attached hereto
12(a)(1) - Code of Ethics - See Item 2
12(a)(2) - Certifications - Attached hereto
12(a)(3) - Not Applicable
12(b) - Certifications - Attached hereto
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
BlackRock Multi-Strategy Hedge Opportunities, LLC
By: /s/ Donald C. Burke
-------------------
Donald C. Burke
Chief Executive Officer of
BlackRock Multi-Strategy Hedge Opportunities, LLC
Date: May 22, 2008
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Donald C. Burke
-------------------
Donald C. Burke
Chief Executive Officer (principal executive officer) of
BlackRock Multi-Strategy Hedge Opportunities, LLC
Date: May 22, 2008
By: /s/ Neal J. Andrews
-------------------
Neal J. Andrews
Chief Financial Officer (principal financial officer) of
BlackRock Multi-Strategy Hedge Opportunities, LLC
Date: May 22, 2008