Man Group a consolidator in hedge industry

By Laurence Fletcher

LONDON (Reuters) - Man Group (EMG.L) plans to be a consolidator in the hedge fund industry in the long-term, said Chief Executive Peter Clarke, who thinks the industry could see redemptions of between a third and a quarter at the year-end. "Consolidation is undoubtedly going to happen ... Longer-term we'd expect to be a consolidator in these markets," he told Reuters in an interview on Thursday.

However, he said the firm was "doing nothing in these markets, there's too much uncertainty."

Clarke also said redemptions in the $1.7 trillion hedge fund industry of between a quarter and a third at the end of the year would be "the right sort of figure."

"The year-end is seeing significant levels of redemptions," he said.

However, Clarke added that many hedge funds had already sold assets ahead of expected redemptions.

"This is not adding significantly to selling pressure (in markets)."

His comments come as the hedge fund industry faces its toughest ever challenge, in the form of highly volatile markets, poor performance and investor outflows.

Earlier in the day, Man Group reported a fall in first-half profits and assets, saying it had brought forward a $107 million amortization charge as its poor-performing Man Global Strategies products moved assets into cash, raising fears of further outflows and sending its shares plummeting.

(Editing by Sharon Lindores)