US hedge fund D.E. Shaw keen to buy distressed assets -FT

Feb 9 (Reuters) - U.S. hedge fund D.E. Shaw has set up a team to look at buying distressed-asset portfolios held by rival hedge fund firms, the Financial Times said. The world's third-largest hedge fund has established DE Shaw Portfolio Acquisitions Unit, which aims to snap up many illiquid assets that are still trading at a steep discount, the paper said.

D.E. Shaw is interested in lapping up "side-pocketed" assets from other hedge funds, the paper said, citing people familiar with the situation.

Side-pockets have become a common practice among hedge fund managers, who are keen to dispose off distressed portions of fund investments to third parties, the paper said.

The new unit will not run its own fund but is mandated to explore opportunities for investment, the paper said.

The hedge fund has about $28 billion in investments and committed capital as of Oct. 1 last year, according to the fund's website.

D.E. Shaw could not be reached immediately for comment by Reuters outside of regular U.S. business hours. (Reporting by Sakthi Prasad in Bangalore; Editing by Muralikumar Anantharaman)