EIM, the fund of hedge funds founded by the hedge fund manager Arpad Busson is believed to have held talks to sell the business with a number of asset managers.
Mr Busson, better known for his relationships with supermodel Elle Macpherson and actress Uma Thurman, is believed to have held talks to sell the business with a number of asset managers.
He has held merger talks with rival asset managers after suffering a spate of client withdrawals.
Like many other fund-of-funds, EIM has suffered a torrid few years since Bernie Madoff’s Ponzi scheme fraud. The industry, which specialises in picking hedge funds for their clients, suffered an embarrassing reputational setback after several lost money having invested in Madoff.
EIM lost $230m in the Ponzi scheme, which was exposed in 2008. Clients have since increasingly by-passed fund of funds to invest directly, lowering their costs by removing the extra layer of fees. Fund-of-funds typically charge fees of 1pc of assets under management and 10pc of any investment gains, which are paid on top of the 2pc of assets and 20pc of gains paid to the underlying hedge funds.
Since 2008, EIM’s assets under management have roughly halved to about $7bn, which has eaten away at its profits. However, efforts to find a strategic partner would be a climbdown for Mr Busson, 49, who only 18 months ago said he was on the hunt for acquisitions.
He would want to remain with the combined group, it is thought. The company employs about 100 people largely at its offices in London, Paris and New York. A spokesman said: “EIM is constantly looking at opportunities to grow its asset base and its operations.”
Aprad Busson has 2 childern with Elle McPerson and is expecting another child with Uma Thurman
Rival fund-of-funds manager FRM last week was sold to Man Group for no upfront cash as part of a deal that could be worth $100m depending on performance. Mr Busson founded EIM in 1992, building his reputation by bringing some leading US hedge funds to prominence in Europe.
He is a renown philanthropist, most famous for organising the high-profile annual gala for his Absolute Return for Kids charity, attended last year by the Duke and Duchess of Cambridge (picture above) More: French Hedge Funder and Women
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