Soros Fund Management to open Hong Kong office: Source
Updated: 2010-01-15 07:29
(HK Edition)
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HONG KONG: Soros Fund Management LLC, the $25 billion hedge-fund firm founded by billionaire George Soros, plans to open an office in Hong Kong, according to a source with knowledge of the matter.
Soros Fund Management may relocate New York-based fund managers James Chang and Dai Jixin to Hong Kong, said the source, who declined to be identified because the information is private.
Michael Vachon, a New York-based spokesman for Soros, declined to comment.
The company and managers such as GLG Partners Inc, with $21.6 billion in assets, are considering setting up shop in Hong Kong this year as a rebound in markets after the financial crisis boosted hedge-fund returns in 2009, and as investors are looking to put more money into Asia. The MSCI Asia Pacific Index climbed 34 percent last year after dropping 43 percent in 2008.
"The Asian growth story will be the dominant economic theme over the coming few years," said Dan McNicholas, head of Asia financing sales for Bank of America Merrill Lynch in Hong Kong.
"Hedge funds and other institutional managers will establish and, in some cases, re-establish their on-the-ground presences here in order to seek out investment opportunities arising from the economic growth, wealth creation and deal activity in this part of the world," he added.
The arrivals will mark a reversal of the trend in the last two years when international hedge-fund managers including Ramius LLC, Citadel Investment Group LLC, Och-Ziff Capital Management Group LLC and Deephaven Capital Management LLC closed down or downsized offices in Asia amid investment losses and redemptions globally.
GLG, a London-based hedge- and mutual-fund manager, will open a research office in Hong Kong and set up a representative office in Beijing, said someone familiar with the plan. The move reflected the company's strong commitment to the region, he added, declining to provide further details.
David Waller, GLG's London-based director of communications, declined to comment.
Fidelity International, manager of more than $210 billion of global assets, announced in November its president of investments, Anthony Bolton, will move to Hong Kong from London to manage a new China fund.
"Boots on the ground in Asia pays off for global investment firms," said Charles Stucke, Chicago-based chief investment officer at Guggenheim Investment Advisors LLC.
"Despite Asia's rapidly maturing capital markets, informational inefficiencies exist. The move would put Soros's team in the heart of the Asian trading community at an opportune time," Stucke observed.
Guggenheim advises wealthy individuals, families, endowments and foundations on $50 billion of investments.
The financial crisis has highlighted a "tectonic" economic shift from the US to China, Soros said in October. China was to emerge as the "greatest winner" from the crisis with the US losing the most, said Soros, who is no longer involved in the day-to-day operations of Soros Fund Management.
"For China, the crisis is something affecting them from the outside," Soros, 79, said to Bloomberg in July. "They can stimulate their economy. They have reserves. They have a trade surplus. They will be one of the motors of the world economy," he predicted.
American Aviation Investment Co, a fund controlled by Soros, bought $25 million of shares in China's Hainan Airlines Co in 1995, the first foreign investment in a Chinese carrier.
Soros Fund Management hired Chang, a former Tiger Asia Management LLC managing director, in November, the source said.
Dai, a Chinese native, has been with Soros for nine years.
Hedge funds globally returned 19 percent in 2009, the best annual performance in six years, bringing assets to $1.48 trillion, according to Singapore-based data provider Eurekehedge Pte.
Bloomberg News
(HK Edition 01/15/2010 page3)