Hedge Funds Placing Heads in China

1 February 2010

2 minute read

As the hedge fund sector put the crisis behind it, many prominent fund firms are giving Asia first priority in expansion plans.

GLG Partners, Soros Fund Management and Prana Capital are among U.S. and UK-based fund groups moving to open offices China and Hong Kong, relocate senior staffers or create new funds that will focus on the region. Other veteran fund pros are launching new shops to invest there, drawn by strong equity market gains last year, low costs and a large base of wealthy local investors. While a firm can invest in Asian companies without a physical presence, being on the ground adds credibility and can aid both capital-raising and trading results.

GLG is opening a research office in Hong Kong and a representative office in Beijing, Reuters reports. Fund manager Anuj Mutreja will relocate to Hong Kong to lead GLG's Asia presence. A spokesman told Reuters, "It's to be closer to investments and to help with marketing." One of Europe's biggest hedge fund managers, GLG is headquartered in London but the company's shares trade on the New York Stock Exchange.

Another UK-based fund, Prana Capital, has said frounder Peregrine Cust might move to Singapore to start an office there. And Soros Fund Management is sending fund manager James Chang and Dai Jixin to Hong Kong, FINalternatives reports.

New Fund Companies Spring Up

Among new company launches, the most visible recent entrant is Galileo Capital Management. Led by Paul Thompson, the former head of Prudential's China asset management joint venture and veteran banker Anders Jacobsen, Galileo plans to focus on under-invested business sectors in Greater China, says FINalternatives. It's based in both London and Hong Kong.

Another new entrant unveiled in January is Hong Kong-based Pangu Capital. Pangu reportedly focus on stocks and hybrid securities in China, Hong Kong and Taiwan, using a form of capital structure arbitrage strategy. Its leaders are Simon Hwang, who recently ran the convertible arbitrage portfolio for Ludgate Hill Investment Management and previously worked at Ramius Capital and JPMorgan, and Anthony Tse, who's worked at TPG and Gandhara Capital.

AUTHORJon Jacobs

Insider Comment

2 comments

Jo
Jon Jacobs
26 February 2010
Simon, we too relayed those stories last year about large global funds pulling back from Asia. Note the third item in the "Related Content" box above, "Asia Layoffs: Citadel, Nomura, Ramius."
-Jon Jacobs, eFinancialCareers news staff
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Si
Simon
26 February 2010
"While a firm can invest in Asian companies without a physical presence, being on the ground adds credibility and can aid both capital-raising and trading results."
Its sad when wealthy investors get swindled into these superficial set ups. As has been mentioned in countless other reports but not this one, New York-based multi-billion AUM funds were sacrificing their Asian offices and investors during the peak of the crisis. Many firms like Perry Capital and Ramius (that Simon Hwang worked at), fired the entire profit-making team and transferred all Asian assets to New York domiciled managers who haven't the slightest clue about Asia.
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