Hedge fund playboy who is well known his parties and knocking up supermodels and actresses has harder time to raise money – Hedgeho News
Aprad ” Arki” Busson, one of the biggest names in the industry is finding raising cash has gotten a lot harder, and not just for charity. Underperformance in the past four years has investors doubting the value of hedge fund to funds as middlemen. Busson’s EIM SA has lost about two-thirds of its assets since 2008, and he said it may not remain a stand-alone company. Aprad Busson, who was born in Paris and lives in London, speaks five languages. He maintains a higher public profile than the average hedge fund party boy, having two children with fashion model Elle Macpherson, 48. He is has a newborn with Uma Thurman after meeting her at a dinner in Rome in 2007.
In 1992, Busson started EIM, or European Investment Management, with $100 million of client money. His success at matchmaking stemmed in part from his ability to tap a group of wealthy friends, some from his prestigious Swiss boarding school, Le Rosey.
Busson hired people with royal and business connections. Philipp von Habsburg-Lothringen worked at EIM’s London office. Aleco Keusseoglou, who attended the same boarding school as Busson and oversaw his family’s shipping company, runs EIM’s Monaco office. Prince Philippos, the son of King Constantine of Greece and Anne-Marie of Denmark, is based in EIM’s New York offices, where Stavros Niarchos, one of the heirs of Greece’s Niarchos shipping dynasty, had previously worked.
EIM rode a boom in hedge funds that saw assets grow 48-fold from 1990 through 2007. Then came the 2008 bankruptcy of Lehman Brothers Holdings Inc. and the unraveling of Madoff’s Ponzi scheme, which dented the reputation of the funds of funds industry because many had failed to protect clients from the fraud. A net $41 billion left the funds of funds industry that year and $118 billion in 2009, according to Hedge Fund Research.
EIM posted its first annual losses in 2008, with accounts declining 8 percent to 19 percent, said the person with knowledge of the returns, asking not to be identified because the information is private. The firm had invested $230 million of client money, or 2 percent of EIM’s assets at the time, in Madoff’s Ponzi scheme.
EIM’s losses and reputational damage tied to Madoff could have been worse. when it’s executives in 2008 were planning a so- called feeder fund that would invest exclusively in Madoff, according to two people with direct knowledge of the matter.
Known as Gilston project – the fund had sought to bypass fees charged by third-party funds through which EIM at that time invested in Madoff, they said. The plans weren’t completed before the fraud came to light in December 2008, the people said.
“Funds-of-funds have basically been providing access and that hasn’t kept up with changes in the industry,” said Jaime Castan, who in May stepped down as co-head of hedge funds at LGT Capital Partners AG, a Pfaeffikon, Switzerland-based firm with more than $5 billion invested in hedge funds.
Some of the bigger hedge funds shun funds-of-funds in favor of direct investments from pensions and endowments. Bridgewater Associates founder Ray Dalio’s $120 billion hedge fund, prefers such institutional clients because they typically commit larger amounts for longer periods, according to an investor who was turned away by the firm and who asked not to be named.
EIM employs more than 100 people, a third of whom are directly involved in managing funds almost $5 billion across 10 global offices. Blackstone has about 130 investment professionals in its hedge-fund business, which oversees almost nine times as much money. Changes in regulation may allow EIM to scale back, as the firm will no longer need to have offices in countries where some clients are based.
No Regrets Busson said, he would be happy to work with a partner who had complementary skills at running a business. He prefers to deal with clients and evaluate hedge funds rather than run the administrative side of the business. As of personal life – Busson lives with Uma Thurman had a baby girl few months ago. (Image on the right Thurman with their newborn)
Read More: BW