(Corrects million to billion in 5th paragraph)
By Chris Vellacott
LONDON, June 19 (Reuters) - Swiss-based hedge fund group Gottex Fund Management Holdings is targeting a $6.5 billion boost to its assets, around half of which will come from acquisitions in Asia and the United States, its chief executive said.
Speaking to Reuters as the firm completes its acquisition of peer EIM Group, Chief Executive Joachim Gottschalk said he expects to announce a new deal in Asia within six months.
“It’s the U.S. and China where we are looking for further acquisitions and further development on the organic and non organic front,” he said. “Within the next 6 months you will certainly hear something about our Asian expansion.”
The merger with EIM, which is still pending regulatory approval, brings total assets to around $8.5 billion which Gottex hopes to grow to $15 billion within five years.
Since the financial crisis, more onerous regulation has driven up operating costs for investment managers, while large institutional investors often rule out allocating any hedge fund money to firms with less than $10 billion under management.
“If you look at where the flows of institutions in alternatives go, it goes to the 10 billion plus investment managers,” Gottschalk said.
In response, many hedge funds have moved to increase their scale by merging with rivals.
Other plans include offering clients access to Chinese assets and Gottex, with Shanghai joint venture partner VStone Asset Management, has applied for a Renminbi Qualified Foreign Institutional Investor (RQFII) licence.
This would allow it to invest directly in China’s mainland capital markets. Gottschalk said he expects to start marketing investments in Chinese markets by the end of the year. (Reporting by Chris Vellacott; Editing by Louise Heavens and David Holmes)