June 30 (Reuters) - Hedge fund manager John Paulson's credit opportunities and merger arbitrage funds were up 6.6 percent and 3.3 percent year-to-date through the end of May, respectively, easily surpassing their benchmarks, according to an investor in attendance at Paulson & Co's recent mid-year client event.
Paulson, who runs more than $21 billion and made headlines last week on news he amassed a large stake in Allergan Inc of more than six million shares and supports a deal between the Botox maker and Valeant Pharmaceuticals Inc , told clients at the recent London event that merger arbitrage spreads are "becoming attractive," noting Allergan and Mallinkckrodt's acquisition of Questcor Pharma.
Paulson's merger fund is up 3.3 percent year-to-date as of the end of May, beating Hedge Fund Research Inc's Merger Arbitrage Index which is up 1.01 percent for the same period and HFRI's Event-Driven Index at 3.07 percent. Paulson's credit opportunities fund, meanwhile, is posting returns of 6.6 percent, easily exceeding HFRI's Credit Arb Index at 3.23 percent and HFRI's Distressed/Restructuring Index at 4.16 percent. (Reporting by Jennifer Ablan; Editing by James Dalgleish)