LONDON (Reuters) - Oceanwood Capital Management has raised $250 million in a new hedge fund to bet on a potential economic recovery in Europe, sources familiar with the matter said on Tuesday.
The firm, a multi-strategy hedge fund spin out from Tudor Group in 2006, has raised the capital from existing investors and plans eventually to raise about $350 million with a final close of the fund in mid-September, the sources said.
Nearly three quarters of Europe’s hedge funds are sub-$200 million in size, according to industry tracker Eurekahedge, making the fund one of the largest to start this year.
The launch comes against the backdrop of the Greek debt crisis, which is causing turbulence in financial markets. But the rise in volatility is an opportunity for some hedge funds to buy cheap assets when signs of a recovery is emerging in some parts of Europe, with the European Central Bank’s quantitative easing boosting investors’ confidence.
The new fund, Oceanwood Peripheral European Select Opportunities Fund, will invest across asset classes with a main focus on financial sector stocks in countries such as Ireland, Italy, Spain, Portugal and Greece. It aims to return 15 percent to 20 percent annually.
The fund’s new assets will add to Oceanwood’s $2.2 billion that it already manages in its main Global Opportunities Fund for some high profile pension funds such as School Employees Retirement System of Ohio and Pennsylvania Public School Employees’ Retirement System.
The London-based firm was founded by Christopher Gate who spent six years running event-driven strategy at Tudor.
The new fund will be managed by Gate and Oceanwood’s partner and Spanish national Julian Garcia Woods, who also invests a portion of the firm’s main fund’s assets.
The capital will be locked up for two to three years or until the fund is terminated, the sources said, adding that investors would be charged a performance fee when they take out their capital.
Oceanwood’s main fund, which is closed to money from new investors, returned 10.2 percent through the end of May, performance data seen by Reuters showed, ahead of a 5.9 percent average gain in peers tracked by Eurekahedge.
The fund had gained 2.3 percent last year to beat a 8.5 percent decline in European peers, the data showed.
Reporting by Nishant Kumar; Editing Carolyn Cohn and Jane Merriman