TheStreet.com – Traditional asset managers want to tap into alternative assets to broaden the services they can offer to investors. More often than not, this leads them to acquire hedge funds, recruit hedge fund managers or incubate new hedge funds inside their firms. Often, buying outside talent through an acquisition is the fastest and most efficient way to grow a hedge fund business, says Ben Phillips, managing director at Putnam Lovell.
This trend was illustrated twofold last week. On April 26, Sparx Asset Management, a giant money-management fund in Japan, announced the acquisition of Hong Kong-based hedge fund PMA Capital Management for $226 million. As a result of the deal, Sparx, which already runs approximately $8 billion in hedge funds assets, will become the biggest alternative-investment player in Asia. And Asia is where a lot of the growth in hedge funds is now taking place.
On the same day, Pioneer Investments, a $200 billion global-asset-management firm, bought Vanderbilt Capital Advisors, a $13 billion hedge fund located in Boston.
