|
|
Bailey McCann, Opalesque New York: Chicago-based Madison Street Capital, an M&A advisor, has released its annual market outlook, and in it suggests that 2016 will be another strong year for hedge fund M&A. Since 2014, the number of hedge fund M&A deals has steadily increased. According to data in the outlook, 2014 saw 32 transactions completed or announced; 2015 had 42 transactions completed or announced, and 2016 is on pace to beat that number.
The majority of these deals are large asset managers acquiring firms or doing team lift-outs for specific strategies. "Given the
escalating growth of allocations directed to the alternative asset space,
there are strong signals that this acquisition trend will continue throughout
2016 and well into 2017," writes Karl D'Cunha, Senior Managing Director, at Madison Street Capital in the outlook. He adds that despite 2015 being a rough year for the hedge fund industry in terms of performance, many small and mid-size hedge funds are performing at or above high watermark levels, making them ripe targets for acquisition.
According to the report, as the hedge fund industry continues to institutionalize, managers that post high returns and have an expertise in niche strategies could become more valuable to large asset management firms as acquisitions than they would be trying to fundraise on their own. This is due in part to investors showing a clear preference for allocating to only the largest hedge funds and asset management ...................... To view our full article Click here
|
|
RSS
