Pengana hedge funds attract industry interest

PenganaCapital has been approached by a number of potential partners to its private equity ‘hedge fund incubator’ venture — a hedge fund-of-funds that will aim to invest across a gamut of new and established hedge fund managers.

The initiative, which the manager announced shortly after inception back in June, is predominantly wholesale but will also be targeted to high-net-worth investors.

“We’ve had about 10 approaches and most have been from long-short equity managers — five out of the 10 have been long-short. Two or three have already been established with their own Australian dollar unit trust and capital, and we’re thinking of optioning up these managers subject to due diligence,” Pengana managing director of hedge funds Damien Hatfield says.

According to director Russel Pillemer, Pengana will look to take about a 50 per cent stake in managers which come on board, though stakes may vary depending on “what each manager brings to the table and how compelling their proposals are”.

“What we’ll be providing to these managers is really a business solution. Everything you need to set up your own hedge fund is here, as in fund structure, IT, office space, marketing and prime broker relationships and so forth,” Pillemer says.

Pengana will also look offshore for sourcing investment capital to the fund, which will be registered in the Cayman Islands, as it has two international road shows planned — one for late September and the other for early October, Hatfield says.

“We’ll probably start taking money in early November and we’re just in the process of appointing our legal adviser,” Hatfield says.