The proposed Man Group/Financial Risk Management (FRM) deal has created the largest independent, non-US funds of funds in the world with $19 billion in assets.
Head of multi-manager business Luke Ellis’ plan to become an institutional one-stop shop of hedge fund products covering commingled FoHFs and sophisticated institutional solutions based on research strength, direct managed accounts investments, risk and advisory services and manager seeding activities is finally taking shape.
In 2010, there were at least 16 FoHF M&A deals, and while things may have quietened down in 2011 with only five FoHF mergers, the accelerated rate for 2012 has seen five deals announced in just two months.
Further mergers and acquisitions in the FoHF space are inevitable as industry consolidation continues. By merging compatible businesses, FoHFs that are suffering from fee pressure can integrate costs. Man predicts it will have $45 million in annualised integration...