New York’s Drake Management has finally decided to close down its USD2.5bn Global Opportunities Fund, which lost 25 per cent in 2007, having already suspended investor redemptions in Decem
New York’s Drake Management has finally decided to close down its USD2.5bn Global Opportunities Fund, which lost 25 per cent in 2007, having already suspended investor redemptions in December. It will wrap up the unwinding by the first quarter of 2009 but investors can expect to get the bulk of their money back by the end of this year.
Some of Drake’s current investors will support the firm’s new fund by switching some USD500m. The firm, founded by Anthony Faillace and Steve Luttrell in May 2001, will decide the fate of two other funds by the end of May.
BlackRock has managed to raise USD275m for BlackRock Absolute Return Strategies, its London-listed fund of funds vehicle, down from an earlier target of as much as USD500m.
The listed entity funnels money into its flagship Appreciation fund of funds strategy, which it acquired with the purchase of fund of funds specialist Quellos Group in October and which posted a 12 per cent gain last year. Overall fundraising for hedge funds has been showing signs of softening, according to reports from data providers such as Hedge Fund Research.
New York investment bank Jefferies & Co is scaling back its exposure to start-up hedge funds amid persistent losses at its asset management unit. Jefferies’ incubation business currently has USD250m assets under management, compared with USD412m at its peak last year, according to chief executive Richard Handler.
An additional USD100m is likely to be withdrawn from its incubation business, which provides funding capital and operational support to start-up managers. The asset management unit lost around USD28m in the first quarter, compared with a USD22m profit in the same period of 2007.
Venture capital firm Kleiner Perkins Caufield & Byers has recruited William Gordon, co-founder and chief creative officer of video games maker Electronics Arts, who will join the firm as a partner in June. Kleiner Perkins funded Electronics Arts’ initial business plan in 1982.
Peter Krauss, who stepped down as co-head of Goldman Sachs Asset Management last month after its hedge fund business suffered extensive losses last year, is reported to be in talks to join Merrill Lynch, whose chief executive John Thain, the former head of New York Stock Exchange, is another Goldman alumnus.
Och-Ziff Capital Management swung to a first-quarter loss of USD268.1m amid declining performance fees and costs associated with its recent IPO. Incentive fees dropped to USD32m from USD625m in the fourth quarter of 2007 as its largest funds lost money. Och-Ziff is currently preparing to launch emerging markets and mortgage-linked funds.
Hong Kong’s Asia Debt Management has raised USD418m for its ADM Maculus Fund V, a five-year private equity-style fund, as well as another USD163m for its flagship ADM Galleus Fund, taking its total assets to USD1bn. The Galleus fund has gained an annualised average of 13 per cent since its launch in 1999. ADM, which was established in 1996, now has USD2.4bn in assets under management.
Galleon Group will this year launch an Asian global macro fund with USD250m and is planning to launch a private equity fund in 2009. Galleon established its Asian headquarters in Singapore earlier this year and now has 45 staff, a mix of personnel relocated from its New York headquarters and local hires. The Singapore team currently runs its USD1.5bn Asia long/short equity fund.
Threadneedle Asset Management has hired David Donora as an executive director who will set up a commodities hedge fund later this year. Donora was previously head of structured OTC derivatives at MF Global UK, the derivatives brokerage that separated from Man Group last year. He reports to William Frewen, Threadneedle’s head of fixed income.
Merrill Lynch alumnus Virgilio Guma has established his own firm, Veotoro Management, in Miami and plans to launch the Veotoro Commodities Hedge Fund at the end of June with up to USD25m. The fund employs a relative value strategy in the commodity and global energy sectors. Guma was previously worked a director of commodities trading at Merrill Lynch in London and has also worked at Texaco.