Marshall Wace boosts profits on fund returns (CityAM)
LONDON-BASED hedge fund Marshall Wace yesterday posted a 20 per cent jump in pre-tax profits led by a surge in income from improved fund performance. The company, set up by Paul Marshall and Ian Wace, improved profits from £39.4m to £47.3m for the year ending February 2012 with income from performance fees up ten per cent to £60.6m from £55m. The firm’s operating entity, Marshall Wace Asset Management – which incurs the costs for the 100 or so staff based at its Adelphi office on the Strand – saw an increase in costs of 19 per cent, mainly due to increasing fund manager performance fees. Staff costs for the firm increased from £20.3m in 2011 to £28.4m.
Hedge-Fund Ads Might Spawn Frauds Unless SEC Takes Action (Bloomberg)
Congress probably didn’t mean to turn the $2.3 trillion hedge-fund industry into a breeding ground for fraud when it passed a law designed to make it easier for small companies to raise capital. That may well be the result unless the Securities and Exchange Commission steps in with new rules. Congress passed the Jumpstart Our Business Startups (JOBS) Act with bipartisan support, and President Barack Obama signed it into law in April. Among its provisions, this misguided piece of legislation allows so-called private placements and hedge funds, lightly regulated private investment pools that serve the wealthy and institutions, to advertise their wares to the public for the first time.
BlackRock cuts stake in Man Group below 5 percent (Reuters)
BlackRock, Inc. (NYSE:BLK) has cut its stake in Man Group by almost half to below 5 percent, regulatory statements showed on Tuesday, just as the embattled hedge fund firm tries to reverse its fortunes. BlackRock’s selling of shares through 2012 mean it is no longer the biggest shareholder in Man. Hedge fund Odey Asset Management has meanwhile made a bold bet on a recovery in Man shares by increasing its stake to 5.15 percent.
Tradex shifts focus to sector FoHFs and single-manager hedge funds (HedgeFundsReview)
Tradex is winding down its Original Segregated Portfolio (OSP), established in 2005, after its assets declined from a peak of more than $500 million to less than $200 million. Michael Beattie, Tradex’s chief investment officer, says the plan is to replace the OSP with a range of sector-specific fund of hedge funds (FoHFs) with three to six underlying managers focused on specific asset classes, sectors and investment strategies. The first of these is the Tradex Liquid Real Estate Portfolio, a spin-out of the OSP’s investments in mortgage strategies. The fund has exposure to six managers running derivatives, distressed and relative value strategies in the mortgage sector.
Citi Awarded Expanded Mandate to Provide Hedge Fund Administration Services to Kayne Anderson Capital Advisors (BusinessWire)
Citi has been awarded an expanded mandate from Kayne Anderson Capital Advisors (“Kayne Anderson”) to provide administration services for five additional hedge funds. Citi’s total hedge fund mandate with Kayne Anderson now includes seven funds and over $2 billion in assets under administration. Kayne Anderson is a Los Angeles-based alternative investment firm focusing in the energy, infrastructure, growth capital, real estate and middle market credit sectors. “We are pleased to continue to demonstrate the value of our operational team,” said Bob Wallace, North America Head of Securities and Fund Services, Citi. “We look forward to continuing to support Kayne Anderson’s growth by delivering leading technology that assists our client’s ability to provide transparency.”
Ex-Soros Manager to Start Distressed Fund for Europe (Bloomberg)
William Seibold, a former founding member of Soros Fund Management LLC’s distressed unit, plans to start a fund to invest in troubled European companies. Recipero Capital will provide capital to middle-market businesses, primarily in Germany, France, Italy and the U.K., starting in the second half of next year, Seibold said in a telephone interview. He expects to have seven people working with him when the fund opens. Seibold, 50, is currently in discussions with potential investors for early allocations, he said. He is seeking 800 million euros ($1 billion). The firm will be based in Europe.
Hedge fund co-founder drops Dilitas suit (FT)
Elena Ambrosiadou, one of the hedge fund industry’s wealthiest women, has dropped a legal case against the security company Dilitas, after accusing it of carrying out surveillance and phone hacking under instructions from her estranged husband, Martin Coward. Mr Coward and Ms Ambrosiadou remain embroiled in a bitter divorce battle centred on the hedge fund they created two decades ago, Ikos, and control of the huge wealth it has generated. Their split has led to dozens of legal actions across Europe and two wide-ranging injunctions that prohibit Mr Coward or other former Ikos employees disclosing information about the company’s affairs.
