Reuters- MFS Investment Management said on Monday it has set up a subsidiary to provide seed capital to hedge funds, in another instance of a mainstream money manager venturing into the alternativeinvestments area.<\/p>\n
MFS, a unit of Canadian insurer Sun Life Financial Inc , said in a statement that the new subsidiary, Four Pillars Capital Inc, will be run as a separate entity, with MFS providing operations and marketing support to the firm.<\/p>\n
The new firm has hired Thomas Knott as its president and Eric Lass as its chief investment officer, MFS said. Knott was a co-founder of hedge fund K Capital Partners while Lass was managing K Capital’s Credit Opportunities Fund, it said.<\/p>\n
“Our institutional clients are increasingly demanding alternative investments to complement long-only strategies and diversify their portfolios,” MFS President and Chief Executive Officer Robert Manning said in the statement.<\/p>\n
The move by MFS, which created America’s first mutual fund in 1924, comes after similar steps taken by some rivals.<\/p>\n
BlackRock Inc said in June it will pay $1.7 billion to buy the fund-of-funds business from Quellos Group LLC.<\/p>\n