Man Group, the world’s largest listed hedge fund manager, has confirmed it will buy the investment management operations of Mayfair-based equities boutique NewSmith.
The deal bolsters Man’s capabilities in equity investment management.
NewSmith, which built a reputation before the financial crisis as one of Mayfair’s best-known hedge funds, manages $1.2bn of clients’ money. It has offices in London and Tokyo and invests in UK, European, Japanese and global equities. It will sit within Man Group’s GLG division.
The fund is about 60 per cent owned by its founders and senior staff members and 40 per cent by Sumitomo Mitsui Trust Bank, Japan’s largest institutional asset manager.
It is understood that senior NewSmith management, which includes its chairman Paul Roy and chief executive Ron Carlson, will stay on at GLG to assist with the integration of the business.
The buyout comes after two of NewSmith’s founding partners, Stephen Zimmerman and Michael Marks, the former chairman of Merrill Lynch in Europe, retired last year. Mr Zimmerman in 2009 appeared before a UK Treasury committee inquiry along with other hedge fund managers to talk about the financial crisis.
Under chief executive Manny Roman, Man, which traces its origins to a Thames-side barrel maker founded in 1783, has been snapping up smaller rivals to expand in markets where it is under-represented, most notably the US.
Other recent deals include Man’s purchase of a fund of hedge funds portfolio made up of $1.2bn of assets from Merrill Lynch Alternative Investments, an arm of Bank of America Corp. It also bought US manager Pine Grove.
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