Davidson Kempner Joins the Rush of Hedge Funds to Abu Dhabi - Bloomberg
US fund manager Davidson Kempner Capital Management is expanding its international footprint into Abu Dhabi, where it is joining a fast-rising number of hedge funds setting up shop in the Emirate.
The investment firm, which manages over $37 billion of assets, has selected Abu Dhabi’s International Financial Centre for its eighth office, according to a statement seen by Bloomberg News. It’s part of a strategy to build “deep local networks” where it invests, said Chief Investment Officer Tony Yoseloff in the statement.
Davidson Kempner will use the new office as a base to deploy capital into the wider Middle East given the growing opportunities it sees in the region.
“We are looking for growth,” Chris Krishanthan, a partner at Davidson Kempner and its co-head of Global Credit, told Bloomberg News. He said the company sees future opportunities across credit, equities and real estate in the Middle East.
The list of funds with a presence in Abu Dhabi is rapidly expanding, with Hudson Bay Capital Management, Marshall Wace and Arini all having selected the capital of the United Arab Emirates for new offices in the last 12 months. One of its appeals is the pool of local cash to potentially tap.
“A key factor is the huge amount of capital within two miles of the city center,” said Naveen Sabharwal, a managing director at Davidson Kempner.
The $1.1 trillion Abu Dhabi Investment Authority has been working with a range of hedge funds, offering everything from long-only bets to quantitative strategies.
For Davidson Kempner, investments in the Middle East have so far been largely credit focused, targeting liquidations, corporate debt, non-performing loans and private lending, Sabharwal said. In total, the fund manager has made around $2 billion of investments in the region.
Davidson Kempner recently acquired a portfolio of bad loans from Abu Dhabi Commercial Bank PJSC with a face value of $1.4 billion, two years after a similar deal for around $1.1 billion. And last year the fund manager became the majority equity owner of the UAE-based plastic manufacturer JBF Group through a debt-for-equity swap.
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