F&C Asset Management has bought Martin Currie Investment Management’s private equity fund-of-funds business. The acquisition will see the three-strong team, led by Hamish Mair, move to F&C’s Edinburgh office.
F&C plans to merge Martin Currie Capital Return Trust with its own Discovery Trust, and the new vehicle will be re-named F&C Private Equity Trust. It will become F&C’s flagship fund-of-funds with assets of more than £90m. Friends Provident will become a cornerstone investor, with a £20m commitment to new shares.
Mair said his team had been in discussion with Martin Currie for quite a while about moving on. He said: “It became known to us that F&C were looking for a fund-of-funds business towards the end of last year.”
For Mair, the move has a number of benefits: “We have secured the backing of a major institution which has a genuine appetite for private equity. It also has a large base in Edinburgh, which is where we are based, and it’s good for our shareholders. It gives us extra fire-power for making investments.”
Martin Currie pulled its second fund-of-funds in early 2004 after only managing to raise a reported £20m of its £150m target.
Nick Criticos, head of UK retail and investment trusts at F&C, said: “We are seeing significant demand from both institutional and retail clients for alternative assets and private equity in particular. With around 7.5% of US institutional portfolios invested in private equity but just 3.6% in the UK we believe this is an area set for further expansion as investors seek to diversify and also participate in the strong returns delivered by this asset class.” “Through our relationship with ISIS Equity Partners we already have an excellent partner for direct investment in UK private equity opportunities via Limited Partnerships and Venture Capital Trusts,” said Criticos. “This will be complemented by our move into the private equity fund-of-funds space which will enable access to global private equity opportunities and a wide pool of private equity talent.”