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From Benedicte Gravrand, Geneva: Capital Z Investment Partners has sponsored and assumed minority interests in 16 hedge fund managers since 1998 (currently sponsoring 10 funds), with a combined $10.8bln of AUM (list of sponsored funds: here). Sponsoring hedge funds and private equity funds is Capital Z’s only business activity. Yesterday, Capital Z's management team, together with Paine & Partners, announced they would buy Capital Z’s hedge fund seeding part of the company and the general partnership interests – thus creating a new entity that will continue to sponsor hedge funds; Capital Z Asset Management.

Laurence Cheng, founder and CEO of Capital Z, will serve as chairman of the board of that new entity. He explained the rationale of the buyout in an exclusive interview with Opalesque: “Investing in early stage hedge funds gives a better chance to have better-than-average returns. Once we find the right managers, we allocate money to their funds and in return, we get a series of (approval) rights and ownership stakes of the management companies. “

“We were looking for ways to validate our economic proposition and this transaction allows us to do that. We brought in Paine & Partners as our partners to buy the ownership stake economic interests of our investors. This is not an exit for me and my team; rather it wi......................

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