Michael Travaglini Hedge Fund

Michael Travaglini Leaving Mass. State Fund for Hedge Fund

There has been a lot of focus on the relationships between state pension and endowment funds and investment funds. As a result of New York Attorney General Andrew Cuomo's investigation into the connection between state pension funds and hedge funds and private equity, many states have changed their policies of using placement agents. Now, the executive director of Massachusetts's $44 billion state pension fund has left to work for a hedge fund. Michael Travaglini will start work in July as a managing director for Grosvenor Capital Management LP.

The executive director of Massachusetts' $44 billion state pension fund, one of the first to make big bets on hedge funds, is resigning and moving to a Chicago-based asset management firm.

Michael Travaglini, 47, who has headed the state fund for six years, will join Grosvenor Capital Management LP in July as a managing director. He will market the firm's portfolios to public pension funds.

Grosvenor, a fund of hedge funds firm that helps select a portfolio of hedge funds for clients, is one of a handful that Massachusetts uses to make its bets in the loosely regulated $1.6 trillion hedge fund industry. Hedge fund investments have significantly boosted the state fund's returns over the last few years.

When Travaglini, a trained lawyer, arrived from Boston-based asset manager Putnam Investments in 2004, the state fund had $32 billion in assets.

State Treasurer Timothy Cahill, who chairs the Pension Reserves Investment Board, praised Travaglini for guiding the pension fund through the financial crisis. Source

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Carried Interest 2011

Carried Interest Tax Hike Passes House, Not Enacted til 2011

Hedge fund and private equity managers will have to pay an increase on their taxes, but not until 2011. The U.S. House of Representatives voted to eliminate the tax benefit for carried interest and if the Senate approves the bill, hedge funds and private equity managers will feel a significant cut in their earnings next year.

Under current tax code, carried interest is treated as capital gain and taxed at only 15% but that would be changed to tax carried interest as ordinary income which can be up to 35%. The measure passed in the House by a vote of 215-204.

The House passed a bill on Friday that would end a tax break for executives of investment funds, leaving hedge funds, private equity firms and venture capitalists scrambling to ease the effects of the bill before it is taken up by the Senate next month.

The measure was part of a broader tax bill, passed by a vote of 215 to 204, that would extend benefits for unemployed people. It seeks to change the tax treatment of “carried interest,” which is the portion of a fund’s investment gains taken by fund managers as compensation.

The plan approved by the House, which overcame strong lobbying pressure from Wall Street, amounted to a compromise that would tax 75 percent of carried interest as ordinary income and 25 percent as capital gains. It is expected to raise more than $17 billion in tax revenue over the next decade. Source

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Hedge Funds Total Assets Survey

Survey Estimates Total Hedge Fund Assets at $2.7 Trillion

The latest estimate on hedge fund industry assets places the figure at $2.7 trillion. But this estimate, from a survey conducted by HFMWeek, may be overly optimistic but it is consistent with total asset estimates from 2007. At the beginning of 2010, BarclayHedge estimated that hedge funds controlled $1.5 trillion, so it's hard to tell which estimate is correct and harder to believe that hedge funds gained $1.2 trillion in the last five months. Still the survey found that the hedge fund industry is growing rapidly (at a rate of 9% over the last 6 months), so such a high total asset estimate may be closer to reality than it seems.

Is the hedge fund industry bigger than most think? It certainly could be, if the latest figures from HFMWeek are any indication.

Its survey of custodians and administrators finds that hedge fund assets under administration have topped $2.7 trillion, roughly $700 billion more than the most optimistic of other measures of hedge fund assets.

The HFMWeek survey also shows that the hedge fund industry is growing rapidly, by 9% over the past six months, and on course to top its previous high of $2.9 trillion and break the $3 trillion barrier this year.

HFMWeek surveyed 79 administrators. Its figures exclude leverage.
The survey shows that most of the growth in the industry is coming in managed accounts. Source

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Asia-Based Hedge Funds Inflows

Barclays Predicts Big Inflow for Asia-Based Hedge Funds

Barclays Capital predicts that inflows to Asia-based hedge funds will increase dramatically this year. This agrees with the fact that hedge funds based in Asia have performed about 5% better over the last three years than hedge funds focusing on Asia but based elsewhere.

Go east, young man, might as well be the new mantra of the hedge fund industry, according to Barclays Capital.

The British bank said inflows to Asian-based hedge funds are set to soar this year, and with good reason: Hedge funds operating in the region have done better, by about 5% over the past three years, than Asia-focused hedge funds based elsewhere, according to Andrea Gentilini, head of strategic consulting at Barclays’ prime brokerage unit.

Investors are likely to pour US$8 billion into Asia-based hedge funds this year, a figure that could hit US$16 billion by the end of 2013, Gentilini told Bloomberg News. Asia-focused hedge fund assets could triple to $71 billion by the end of this year, she said, with nearly 40% of that money invested with Asia-based firms. Source

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Paulson Credit Opportunities Fund

Top Hedge Fund Ranking for Credit Opportunities Fund

John Paulson's hedge fund has had extraordinary performance and this year his fund earned the top position on a top 100 hedge fund rankings. Paulson & Co.'s Credit Opportunities Fund nabbed the number 1 spot on Barron's Top 100 Hedge Fund list. The fund produced an amazing three year compound annual return of 122.92%, beating second place Balestra Capital Partners’ fund by almost double its 65.63% three year annual return. Renaissance Technologies Medallion fund took third with 62.8%.

Paulson’s Credit Opportunities Fund took the top spot in the annual Barron’s Top 100 Hedge Funds list. Barron’s ranks funds by their three-year compound annual return, which left the $4 billion Paulson credit fund well clear of the field at 122.92%.

Second-best was barely half as good, with Balestra Capital Partners’ eponymous fund earning an annualized 65.63% over the past three years. Renaissance Technologies Medallion fund came in third at 62.8%, followed by Element Capital at 45.02% and Providence Investment Management’s MBS Offshore fund at 44.29%. Odey Asset Management’s OEI Mac fund was sixth at 41.78%.

In addition to taking the top spot, Paulson is also the only firm with two funds in the top 10, which its Paulson Advantage Fund—which was first in the Barron’s ranking last year—falling to seventh place with a 41.31% annualized return. The Paulson International fund also made the list, rounding out the top 30 with a 20.23% annualized return. Source

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U.S., U.K Hedge Fund Centers

U.S. and U.K Remain Only Major Hedge Fund Centers

Despite regulations and reforms in both the United States and the United Kingdom, the two countries remain the only major hedge funds hubs. According to a recent survey, the U.S. remains home to more than 7 of 10 single manager hedge funds, just a slight decrease from 2008. Furthermore the U.S. dominates the number of assets by location with 78.84%. Britain has suffered bigger losses but still is one of the top locations for hedge funds.

The U.S. is still home to more than seven out of 10 single-manager hedge funds, with 70.11% of funds based in the country last year. That’s down from 2008, but barely: It had been 70.48%. By assets it’s an even more overwhelming lead, at 78.84%, down from 79.63%.

Britain saw a somewhat steeper drop—Europe’s largest hedge fund manager seems likely to be the hardest-hit by the EU rules and has already seen some high-profile managers move to Switzerland or the Channel Islands. But the country’s hedge fund industry has not exactly been obliterated, as it now accounts for 12.36% of funds (down from 13.3%) and 12.19% of assets (down from 12.62%).

By comparison, all other jurisdictions are pygmies. China was a very, very distant third with 2.69% of hedge funds, followed by Switzerland at 1.83%. Canada was fifth with 1.75%. Source

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GLG Man Group Shareholder

Shareholder Sues GLG Over Merger with Man Group

Analysts and investors questioned the wisdom of Man Group's acquisition of GLG Partners, and one GLG shareholder has brought a lawsuit over the merger. The shareholder, Ron Duva, has filed a lawsuit maintaining that the deal with Man Group undervalues its shares. GLG has said that the lawsuit is "entirely without merit."

The deal would create the world’s largest hedge fund manager, with some $63 billion in assets, at the expense of GLG’s investors, Ron Duva alleges. “The timing of the proposed transaction has been engineered to take advantage of a recent decline in the trading price” of GLG shares, the lawsuit, filed in Delaware Chancery Court, claims.

Man has agreed to pay $4.50 per share for GLG, a 55% premium to its stock price when the deal was announced on May 17. It’s still more than GLG shares are trading for today, about $4.22, and only slightly below its 52-week high of $4.61. But that is still less than half what GLG shares were valued when the firm went public on the New York Stock Exchange via a reverse-merger.

Duva’s lawsuit also alleges that the Man deal “contains provisions designed to entrench management and deter alternative offers,” specifically challenging both the $48 million breakup fee that GLG would have to pay if it backs out of the deal, and the provision paying GLG executives in Man shares rather than in cash, as other GLG shareholders will be paid. Source

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London Diversified Management Losses

London Diversified Management Falls from $5b to $300m

Many hedge funds have performed well from the beginning of 2009 to this point in 2010. But some hedge funds have fallen by the wayside during this recovery--for example, Asian hedge funds' slower recovery or the UK Ebullio fund's 70% loss. Another story of a hedge fund struggling is that of London Diversified Management LLP, a hedge fund at the beginning of 2008 managed $5 billion. In the last two years, London Diversified Management's assets have fallen to just $300 million.

London Diversified Management LLP, a hedge-fund firm that managed $5 billion at the beginning of 2008, shrunk to just $300 million over two years, after the performance of its flagship fund tumbled and investors pulled out money.

The financial crisis wiped hundreds of billions of dollars from the hedge-fund industry, and smaller hedge-fund firms in particular have struggled to recover. Assets managed by London Diversified Management , founded by former J.P. Morgan Chase traders David Gorton and Rob Standing in 2002, had risen to $500 million as of April after tumbling to $300 million at the end of 2009, according to a person close to the company. The firm had managed $5 billion at the start of 2008.

The flagship London Diversified Fund, which focuses on fixed-income securities and derivatives, lost 28.1% of its value in the 2008 calendar year, according to investors in hedge funds. It recovered somewhat in 2009, gaining 4.9%, and was up 1.2% in January, the most recent month for which those investors had figures. Source

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Blackstone Fidelity Deal

Blackstone Fidelity National

Blackstone Group Buyout of Fidelity National Falls Through

Earlier this month there was a rumored buyout of Fidelity National Information Services (FIS) and now it appears that the deal has fallen through. The consortium of private equity firms led by Blackstone Group LP (BX) scrapped its plan a buyout of Fidelity National, reportedly because the parties could not agree on a price. Now, Fidelity has said that discussions of the buyout have stopped and the company will be attempting a leveraged recapitalization with a large buyback of shares.

A consortium led by Blackstone Group LP (BX) dropped its plan to acquire the financial-data processor late Monday over a disagreement in price, a person familiar with the situation told The Wall Street Journal. The company confirmed Tuesday morning the discussions had ceased and said it would pursue a leveraged recapitalization with a "substantial" share repurchase.

Fidelity National's shares were recently off 5.2% to $27.37. The stock is up 17% so far this year and 46% in the last 12 months.

Robert W. Baird analyst David Koning acknowledged the recapitalization will add to Fidelity National's debt load but said similar companies have been able to support three times debt to Ebitda, and though Fidelity National has about $3.1 billion in total debt, that's just 2.1 times debt to trailing Ebitda.

Of course, there's also the possibility other bidders may emerge for Fidelity National, though it's unclear whether a private-equity deal or a purchase by a peer would be more likely. Source

Read about the rumored Fidelity National buyout by Blackstone

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Asia Banks Hedge Funds

Asian Private Banks Prefer Event-Driven Hedge Funds

Private banks in Asia are telling clients to place their money in hedge funds and especially favoring event-driven hedge funds. The banks are expecting an uptick in mergers and acquisitions activity and debt restructuring. With the overall market uncertain so far this year, the banks expect event-driven hedge funds to excel over other strategies.

Unlike in 2009 when stocks rallied across the board, the overall market direction is less certain this year and the best returns will likely come from event-driven managers who can better navigate the twists and turns in M&As compared with traditional long-only and exchange-traded funds (ETFs).

In debt markets, corporate and emerging market spreads have narrowed significantly, and outsized gains will come from sorting out the over $400 billion (279 billion pounds) in leveraged loans from the buyout bubble that will mature in the next few years, private bank investment strategists polled by Reuters said.

"The event-driven is our top strategy... We've recently gone positive on that strategy, and part of the reason is because we expect to see a lot more event-driven deals like mergers and distressed," said Karen Tan, director of the hedge fund group at Deutsche Bank Private Wealth Management in Singapore. Source

Learn more about event-driven hedge funds

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Hedge Funds Cut Bets

Hedge Funds Cut Bets in May As Stock Market, Euro Struggle

The instability in the stock market and the struggling euro caused hedge funds to cut back bets in the last few weeks. Hedge funds have reduced leverage and positioned themselves defensively in what has been a tough month of May. Still, hedge funds aren't reverting to their caution in the midst of the financial crisis.

Hedge funds are now positioned defensively with lower levels of borrowing, said Campiche, who oversees more than $8 billion invested in portfolios of hedge funds.
He thinks global macro managers are best placed to profit from the turbulence.

"The first week of May was difficult," Campiche said in an interview late on Monday. "Since then managers have derisked quite aggressively. Like everyone, they don't have a clue where things are heading so they've reduced their balance sheet.

"Right now, leverage is very low," he added. "Funds are playing defence but there's no panic... Everyone is much more on their toes."

However, funds are still not as cautious as during the nadir of the credit crisis in late 2008 and early 2009, he added.

Hedge fund long leverage was just over 1.5 times in October 2008, according to data from Britain's Financial Services Authority, rising to 1.78 times by October 2009. Source

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Crude Oil Hedge Funds

Hedge Funds Cut Bullish Bets on Crude Oil as Prices Fall

Hedge funds sold crude oil at the fastest pace in eight months cutting bullish bets by 32%. The move appears to be a result of concerns over Europe's debt crisis and how it will effect energy demand.

The speculative net-long position in crude oil futures and options combined on the New York Mercantile Exchange fell to 89,335 in the week ended May 18, the biggest percentage decline since Sept. 29, according to the U.S. Commodity Futures Trading Commission’s Commitments of Traders Report on May 21.

Crude dropped 20 percent from a 19-month high of $87.15 a barrel May 3 on concern Europe will undermine a recovery from the worst recession since World War II. Supplies of oil and all petroleum-based fuels jumped to 1.81 billion barrels in the week ended May 14, the highest stockpiles on a seasonal basis based on Energy Department data back to 1990.

“Wall Street was bailing out of the market,” said Stephen Schork, president of the Schork Group Inc. in Villanova, Pennsylvania. “The latest sell-off is confirmation that money managers are exiting. I expect next week’s report will show another significant sell-off.”
Source

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Hedge Funds Register with SEC

Finance Bill Passes: Hedge Funds Will Register with SEC

Hedge funds will have to register with the Securities and Exchange Commission now. The Senate and House versions of the financial reform bill both require hedge funds over a certain size to register with the regulatory agency.

The Senate and House versions of the bill require all hedge-fund advisers over a certain size to register with the Securities and Exchange Commission. That would give the agency a greater window into the trading positions and investment strategies of hedge funds, typically secretive firms that cater to wealthy individuals and big investors.

"There will definitely be an increased level of reporting," said Steve Nadel, a hedge-fund lawyer in New York, adding that the registration requirement "has the most immediate impact" of any hedge-fund-related provision in the bill.

Lawmakers also are aiming to give the SEC more discretion in its authority over hedge funds, likely leading to deeper scrutiny of the industry's client base and trading partners, as well as its investments. Although hedge funds have successfully resisted much oversight, some regulators say additional scrutiny is needed to reflect the increased influence of hedge funds on financial markets. Source

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Asian Hedge Funds EU

European Union Rules May Harm Asian Hedge Funds

The European Union's directive on alternative fund managers is expected to hurt Asian hedge funds. US hedge funds are preparing for the problems of complying with EU rules but Asian hedge funds also rely on European Union investors and will suffer from the regulation, according to Andrew Baker, the head of the Alternative Investment Management Association.

The European draft rule to tighten hedge-fund regulations may hurt the industry in Asia as managers lose access to investors in the Europe Union, said Andrew Baker, who helms the industry’s largest trade group.

The European Parliament’s economic and monetary affairs committee approved this week a measure to force hedge-fund managers outside the EU to agree to transparency standards in exchange for marketing access to investors in the bloc.

“The whole industry, whether it’s direct or indirect, may suffer a negative impact,” Baker, the London-based chief executive officer of the Alternative Investment Management Association, said in an interview in Singapore today. New restrictions in Europe mean “there may be barriers raised between the regions which will prevent one region taking advantage of capital flows from another region,” he said. Source

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Top 4 Capital Raising Secrets

4 Capital Raising Secrets

There are many aspects of capital raising which are counter-intuitive. These tend to involved lessons learned the hard way, over time that eventually gives managers who have moved up the learning curve of raising capital a distinct advantage.

Here are the Top 4 Capital Raising Secrets I have experienced and noticed first hand that many $100M-$300M hedge funds are still picking up as they grow.

Daily Action is How Capital is Raised: It may seem overly simplistic but many capital raisers or fund principals focus either on very short-term results or only on capital raised and not on daily progress. Your CRM system can easily produce tangible investor pipeline development reports which can track exactly how many tangible physical actions were taken every day towards raising capital. This has to be part of what you consider evidence that capital raising efforts are well underway. Focusing only on capital brought in leads to un-managed expectations and hire turnover with both third party marketers and in-house marketers.
Moving up the Capital Raising Learning Curve Quickly is a Competitive Advantage: How well trained is your team? The average hedge fund spends less than 2 days a year, or less than $1,000 per employee on training, yet a huge multiple of this sum of money on marketing materials, overhead and infrastructure. What if your team was trained to raise capital 3x more than your competition? What if you could work 20% more efficiently and got 20% more accomplished every single day? That would lead your firm on a path to raising an exponentially higher amount of capital than others because you would more quickly be able to experiment and move up the learning curve on how to raise a lot of capital for your fund. Which leads to the next secret of capital raising:
Speed of Implementation: This is something I covered in details during my last in-depth hedge fund marketing seminar called Hedge Fund Marketing Mechanics. The faster you move forward, experiment, test, learn, re-adjust and try more capital raising plans the faster you can adapt. The saying goes the most successful plants and animals on earth long-term are not the fastest or strongest, they are the most adaptive. This is something I remind myself of every day in our own business and when consulting with hedge funds on capital raising plans.
Choosing the right investor channel is key and 5 minutes of planning can save you 5 weeks of experimentation and painful cold calling to the wrong investors. I have learned this the hard way, trust me it is always best to research exactly which channels of investors and in which geographical regions are going to be most interested before trying to reach out to everyone you can. This may seem obvious to $10M+ hedge funds but as you hire third party marketers, train new professionals on your team, and delegate it needs to be passed on to everyone. Every team has limited resources so where you spend those each and every day is one of the most important decisions you can make.

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EU Hedge Fund Compromise

Possible Compromise on European Union Hedge Fund Rules

According to the Wall Street Journal, hedge funds and private equity firms are beginning to accept that the European Union will pass at least some form of the directive on alternative fund managers. This gives some room for compromise in the final negotiations and hedge funds are probably already pleased that the more strict proposals have been removed from the bill like imposing a strict fixed limit on leverage. Furthermore, private equity firms are expected to escape with less regulation than hedge funds and venture capital firms with less than 50 employees are exempt from the laws. These areas show that there is room for negotiations and many hope that hedge funds can water down the legislation in the final days before the directive goest to vote.

But many of the alternative-asset-management industry's biggest concerns have been watered down. The directive will give regulators new oversight of funds' leverage and capital ratios, but will no longer impose fixed limits.

Meanwhile, the French and German finance ministers haven't ruled out a compromise over new rules that would block funds domiciled outside the EU from marketing to European investors unless their home markets have equivalent regulatory oversight, a move that has raised concerns over protectionism, including from U.S. Treasury Secretary Timothy Geithner. The finance ministers have said that, so long as funds are adequately monitoring systemic risk, their access will remain unchanged. Private-placement systems might be allowed to continue, at least until a concept of regulatory equivalence has been agreed to. The European Parliament's draft even offers the carrot of a pan-EU "passport," provided funds agree to comply with the new rules and their home regulator agrees to enforce them. source

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GLG Partners Hedge Fund

The Rise and Fall of GLG to Man Group's Purchase

One of the biggest hedge fund firm purchases this year is Man Group's acquisition of GLG Partners. The wisdom of Man Group's buy has been questioned by some analysts and observers who claim that the hedge fund firm paid too high a premium for GLG shares. Dealbook has provided a good summary of GLG's rise and fall from its public listing via Freedom Acquisition Holdings to Man Group's purchase.

GLG Partners, the hedge fund group, got its New York stock market listing when Freedom Acquisition Holdings, a blank-check company, bought a stake in mid-2007. Then, Freedom’s stock traded above $10. Now, the Man Group, listed in Britain, is buying GLG for $4.50 a share. Sure, Freedom’s owners are getting a price they haven’t seen since last August. But longer term, it looks like a bounced check for investors, Breakingviews argues.

That is how GLG came to market, bypassing the extra complexities of an initial public offering of its own in a deal with Freedom that valued the hedge fund firm at around $3.4 billion. Now, even in a logical-seeming deal that accords GLG a roughly 50 percent premium to the closing price of its stock on Friday, the Man Group is set to buy GLG for around $1.6 billion. For any shareholders still around from the beginning of Freedom-turned-GLG, that’s a disappointment, Breakingviews says. Source

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Germany Short-Selling Ban

Germany Bans Short Selling, Angers Hedge Funds

Germany has instituted a controversial ban on naked short selling, hoping to prevent speculators from disturbing the financial markets. Germany has banned naked short selling in some stocks, euro-dominated bonds, as well as credit default swaps--likely a reaction to the role of CDC's in Greece's debt crisis.

But funds say they make markets more efficient and the ban could create more problems.
"I think it's ridiculous," said Pedro de Noronha, managing partner at hedge fund firm Noster Capital, which invests in credit default swaps. "All it proves is how scary it is to have people who are unsophisticated in ... financial markets imposing regulations on products they don't understand."

The move bans naked shorts in some financial stocks and euro-denominated bonds, as well as related transactions in credit default swaps (CDS), which attracted controversy during Greece's debt crisis, although funds say they accounted for a fifth or less of activity in Greek sovereign CDS.

David Stewart, chief executive of high-profile London-based hedge fund firm Odey Asset Management, warned the move could create, rather than remove, dislocation in financial markets.

"This could be very frightening for everyone. Once you start interfering with the markets it leads to dislocation," he said. "If there's just soundbite politics ... and no real co-ordination it's very unsettling." Source

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Hedge Funds Performance April

Hedge Funds Show Positive Performance in April 2010

Hedge fund performance was again positive in April 2010, the HFN Hedge Fund Aggregate Index returned +1.55% last month. Hedge fund assets rose by an estimated 1.60% to about $2.3 trillion in April. Here are the highlights from the HFN April data.

Through April, the HFN Hedge Fund Aggregate Index stood 3.91% above the pre-2008 financial crisis peak set back in October 2007.

Hedge fund assets increased an estimated +1.60% to $2.299 trillion in April.

Investors allocated a net $7.67 billion to hedge funds in April and performance accounted for an additional $28.52 billion resulting in a total assets increase of $36.18 billion during the month.

Investor flows were positive in April for the 11th month in the last 12. There was a slight outflow in December 2009 due to year-end redemption trends.

The Core Growth Rate (% increase in assets due solely to investor flows) was +0.34% in April.

Total hedge fund assets are an estimated $638 billion below their peak set in Q2 2008. Source

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EU Back Hedge Fund Rules

Most EU Member Countries Back Hedge Fund Rules

It has been a slow march for European Union countries regulating hedge funds but EU governments moved one step closer yesterday. The majority of EU member countries backed the directive on alternative asset managers and voted to start talks over the final legislation.

The European Union moved a step closer to new rules on hedge funds and private-equity firms on Tuesday, with most member states backing regulation and agreeing to begin talks on final legislation with the European Parliament.

The proposal backed by finance ministers at the European Council calls for fund managers to be authorized by national governments. National authorities will also review the trading activities of funds and approve their internal risk-management practices.

Many EU governments said hedge funds, using billions of euros in borrowed money, destabilized financial markets during the financial crisis of 2008 and later helped fuel a speculative attack on the government debt of Greece and other troubled euro-zone states. Source

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Man Group GLG Merger

Man Group Purchasing GLG Partners for $1.6 Billion

Man Group is paying a 55% premium on Friday's closing price to buyout GLG shareholders. The hedge fund firm is trying to diversify its business so that it does not rely too much on its flagship AHL fund. Man Group's share price took a hit from investors and analysts wondering whether the firm paid too high a price for the acquisition.

Man said it expected the acquisition to add to earnings in 2012. GLG’s founders, Noam Gottesman and Pierre Lagrange, and the co-chief executive, Emmanuel Roman, agreed to a lock-up for their shares for three years. They also agreed to swap their GLG shares for Man stock at $3.50 a share, well below the cash offer to other GLG shareholders.

“We have known Man for many years and can be certain that our two businesses are highly complimentary, both focused on delivering long-term performance but each with differing client bases and uncorrelated investment strategies,” Mr. Gottesman said in a statement.

Man said in March that profit before tax probably fell in the year until the end of March after the performance of AHL disappointed and funds under management declined in the fourth quarter. Source

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