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Palmer Square seeds long/short hedge fund manager Millstreet with $25m

Wednesday, May 04, 2011
Opalesque Industry Update - Palmer Square Capital Management, in partnership with Atlantic Asset Management and Montage Investments, today announced that the Palmer Square Emerging Manager Fund, LP has provided $25 million of capital for a seed investment with Millstreet Capital Management LLC, a long/short credit hedge fund manager. In addition to securing strategic investment capital, the relationship provides Millstreet with access to the distribution channels of Atlantic and Montage.

“Millstreet is a natural fit for Palmer Square’s Emerging Manager Fund,” said Palmer Square President Christopher D. Long. “Having worked together in the past, the senior team at Millstreet has deep experience analyzing companies, a disciplined investment approach based on thorough research, strong risk management, and a track record of success at well-regarded institutions.”

Based outside of Boston, Millstreet focuses on high yield credit with an emphasis on out-of-favor and overlooked U.S. corporate bonds and leveraged loans. The investment team has spent the majority of their careers focusing on investments in the high yield corporate credit space.

“Millstreet also serves as a great complement to Cypress Capital Management, our Fund’s long/short equity manager,” Long explained, referring to his firm’s other recently announced investment deal. “As our newest hedge-fund manager, Millstreet provides added diversification with their long/short credit expertise.”

The agreement to invest in Millstreet was done in partnership with Atlantic Asset Management, which brings decades of experience in identifying and partnering with talented emerging managers. The agreement was further enabled by Palmer Square’s affiliation with Montage Investments – a unique group of asset managers offering multiple investment solutions, including mutual funds, closed-end funds, separately managed accounts and alternative investments to financial intermediaries.

Don Trotter, Managing Director of Atlantic Asset Management, commented, “In our opinion, the Millstreet team established solid credentials prior to the launch of their fund in June of 2010. Since then, we believe they have continued to build a very strong track record.”

“The partnership with Palmer Square – and the capital resources they are investing in our efforts – is an exciting event in our firm’s history,” said Millstreet co-founder Craig Kelleher. “This agreement allows us to focus exclusively on generating attractive risk adjusted returns on behalf of our clients. By combining our investing experience with Palmer Square, Montage and Atlantic’s institutional marketing resources, Millstreet is in a unique position to grow the business in the years ahead,” said Millstreet co-founder Brian Connolly.

(press release)

About Palmer Square Capital Management
Palmer Square Capital Management provides investment advisory services, proprietary funds, and customized allocations focused specifically on alternative investments such as hedge funds and private equity funds.  The firm serves a diverse set of clients across high net worth, registered investor advisor firms and institutional clients. Visit www.palmersquarecap.com.

About Millstreet Capital Management
Millstreet Capital Management employs a fundamental investment philosophy with a focus on the over-looked mid-tier segment of the high yield market.  These mid-tier companies are well-established entities with quality assets and impressive growth profiles, yet often fall under the radar of many investors and subsequently trade at significant discounts to their underlying values. 

In addition to value, Millstreet looks to invest in companies characterized by improving fundamentals, low leverage, high free cash flow yields, and near-term catalysts.  To maximize and protect investor capital, Millstreet augments this approach by implementing capital structure arbitrage trades when appropriate as well as portfolio protection strategies. The Millstreet Credit Fund is managed by a cohesive team with decades of portfolio management, research, and trading expertise in the high yield market. Visit www.millstreetcapital.com.

- FG

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