BOSTON (Reuters) – Blackstone Group LP is backing a brand new hedge fund being run by former Eton Park companion Aaron Wertentheil with a $150 million dedication, two sources conversant in the matter mentioned on Tuesday.
FILE PHOTO: The ticker and buying and selling info for Blackstone Group is displayed on the publish the place it's traded on the ground of the New York Inventory Change (NYSE) April 4, 2016. REUTERS/Brendan McDermid
Wertentheil is launching Jones Highway Capital Administration with roughly $300 million in belongings, together with the capital from Blackstone, plus cash from Eric Mindich, his former boss at Eton Park, and an unidentified endowment, mentioned one of many sources.
New York-based Jones Highway will think about particular conditions investments within the company credit score, authorities credit score and equities markets, amongst others, the sources mentioned.
Blackstone has already dedicated to additionally placing capital right into a second portfolio that Wertentheil expects to lift after ending fund elevating for the primary one, signalling the agency’s sturdy confidence within the supervisor.
The sources couldn’t converse publicly as a result of the funding is personal.
Wertentheil couldn’t be reached for remark.
Blackstone, which invests $78 billion in hedge funds, is making the funding with money from its $1.5 billion Strategic Alliance Fund III, because it bets that new gamers can reach an business that has struggled with poor returns and investor withdrawals lately. It has to this point seeded six managers from this portfolio, together with Tresidor Funding Administration and Seiga Asset Administration.
Blackstone’s seeders historically take a 15 to 25 p.c lower of the fund’s enterprise, folks conversant in the phrases have mentioned.
Wertentheil labored for years at Mindich’s multi-strategy fund Eton Park, which made business historical past for hedge funds when it raised a file $three billion in 2004. Wertentheil oversaw greater than a billion in belongings at Eton Park and stayed on to assist shut the agency.
Wertentheil began producing buzz quickly after Eton Park’s finish in 2017 as somebody who may begin his personal agency or be part of an present one in a senior function.
James Connolly, who additionally labored at Eton Park, is a companion and senior managing director at Jones Highway. Robert Renda is the agency’s chief monetary officer, having beforehand labored at Folger Hill Asset Administration, and Michael Adams is the chief working officer and normal counsel.
Securing seed investments from Blackstone usually helps the brand new managers set up credentials and stand up and operating whereas it permits Blackstone to get in on the bottom ground with promising newcomers.
Competitors for Blackstone’s seed cash is all the time fierce. However some critics notice that seeder funds’ information might be uneven irrespective of how thorough the due diligence.
Reporting by Svea Herbst-Bayliss in Boston; Modifying by Matthew Lewis