Richcourt Moves To Hamilton Lane –

Hamilton Lane Advisors’ year-long search for a hedge fund counterpart ended earlier this month when the Bala Cynwyd Pa.-based private equity investment manager agreed to acquire a control stake in The Richcourt Group. Financial services provider Citco Group Ltd., which sold Richcourt to Hamilton Lane for an undisclosed amount, will retain a significant stake in the international hedge fund of funds manager. The change of ownership will take affect by this Friday.

Headquartered in New York, Richcourt currently manages around 30 hedge fund portfolios and investment strategies valued at more than $1.5 billion. For Citco, the sale will enable its hedge fund operation to focus entirely on fund administration and custody.

Upon completion of the transaction, John Mensack-hired by Hamilton Lane for the sole purpose of sourcing the hedge fund acquisition-will be named CEO of Richcourt and will be the only Hamilton Lane executive with a daily role at the hedge fund of funds manager. According to Hamilton Lane, no other management changes have been planned.

Erik Hirsch, the chief investment officer at Hamilton Lane, said that more and more institutional investors have been looking to increase their exposure to hedge funds in ways that fit their particular investment parameters. He added that allocations to hedge funds have been increasing over the past five years and that there is currently between $800 billion to $1 trillion of invested capital in the asset class.

“Increasingly, our clients are being asked to be responsible for their alternative asset platforms as a whole, and they come to us wanting to run their operations on a more macro level,” Hirsch said. “Hearing those concerns, and seeing their allocations to hedge funds, we felt that we had to add a dedicated hedge fund aspect to Hamilton Lane.”

And while the hedge funds, as an asset class, continue to grow more popular, so too are hedge fund asset managers. According to Dublin-based financial researcher Research and Markets, it is estimated that there are 675 hedge fund of funds operating today. “The firms sponsoring these products range from large investment organizations, deploying billions, sometimes tens of billions, of dollars to small organizations looking after a few million dollars of capital on behalf of a single wealthy family,” said the report.

The research note goes on to say that given the widening interest in hedge funds and the proliferation of hedge fund managers, it is likely that hedge funds of funds will continue to grow, as investors seek professional advice in the creation of hedge fund portfolios

Hamilton Lane was founded in 1991 and upon completion of this transaction will have more $27.5 billion of non-discretionary assets and $6.5 billion of discretionary assets under management. Recent private equity funds backed by the firm include the $4.25 billion Providence Equity Partners V LP, the $6.54 billion Blackstone Capital Partners IV LP, and Texas Pacific Group’s $5.3 billion TPG Partners IV LP. Hamilton Lane has also shored up European vehicles managed by London-based firms Bridgepoint Capital Ltd., Charterhouse Capital Partners LLP and CVC Capital Partners