EUROPE – BNP Paribas Asset Management has boosted its fund of hedge fund business with an agreement to buy a stake in partner firm Fauchier Partners.
The bank said the move was a “natural development” of its current three-year-old joint venture relationship with London-based Fauchier.
BNP Paribas said that the operations of the two firms’ joint venture, BNP Paribas Fauchier Partners, would merge with Fauchier Partners. In turn, the French bank will buy a 50% stake in the enlarged Fauchier for an undisclosed sum.
“Developing our alternative investment business is at the heart of BNP PAM's strategy,” said Gilles Glicenstein, CEO of BNP PAM. “Our ambition is to be one of the European leaders in this field.
“The creation of this new entity is a natural development in the cooperation between BNP PAM and Fauchier Partners.
“It will enable us to combine an entrepreneurial approach which is so essential to successfully managing funds of hedge funds, an independent investment process and the dynamism of an international group.”
“Both our firms feel that the time is now right to simplify the current ‘two company’ structure. The merger achieves this in a single step,” said Patrick Fauchier, who founded the firm 10 years ago.
Under the deal, majority-voting rights will remain with Fauchier’s management – with Fauchier himself and Christopher Fawcett remaining as chief executive and chief investment officer respectively.
“Following the merger, which is subject to regulatory approval, Fauchier Partners will become one of Europe’s leading dedicated managers of funds of hedge funds with assets of the equivalent of some 3.5 billion dollars (2.7 billion euros),” said the bank.
In April this year BNP PAM bought the Javelin fund of hedge funds business from Zurich Financial Services’ ZCM Investor Capital arm, to be managed by the Fauchier joint venture.