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EIM group in merger talks
 
  Hedgeweb - WED, MAY 30 2012
Funds & Investment EIM, the $7bn hedge fund group founded by Arpad ??Arki? Busson, is in talks to merge itself with rival asset management firms.

The firm, based in Nyon, Switzerland, has been in early-stage discussions with three potential suitors, according to people familiar with the process.


Investors in EIM, many of whom have close personal connections with Mr Busson, are keen to sort out the long-term future of the fund of funds business.

Many fund of funds ?? which invest money in portfolios of individual hedge fund managers on behalf of clients ?? have struggled to regain lost ground since the financial crisis, with many suffering from flat performance and heavy investor outflows.

While EIM??s assets have remained stable for the past few years, the fund was dented in 2008 by having made a $230m allocation to funds linked to the Madoff fraud and has seen its asset base shrink significantly from its peak.

Mr Busson ?? best known by most outside the industry for his high-profile relationships with supermodel Elle Macpherson and now actress Uma Thurman ?? was an early star in the hedge fund industry.

Now 49 years old, he cut his teeth by raising big sums for fledgling funds run by star traders such Louis Bacon??s Moore Capital or Paul Tudor Jones?? Tudor Investment Corporation in the early days of the industry.

Mr Busson founded EIM in 1992 to capitalise on his reputation and built the firm to its pre-crash status as one of the largest and oldest investors in hedge funds in the world.

Mr Busson now hopes to find a strategic partner with whom EIM could merge with himself remaining a shareholder in the combined businesses.

A spokesperson for EIM said, ??EIM is always open to opportunities to grow its asset base and grow its business.?

News of EIM??s interest in a potential merger was first reported by Bloomberg.

Many funds of funds have been seen as potential acquisition targets in recent months, but valuations in the industry remain difficult to square with owners?? expectations.

Last Monday, FRM, one of the fund of fund industry??s best-known names was acquired by the London-listed Man Group for just $80m ?? a maximum consideration payable over three years and dependent on future performance. FRM manages assets of $8bn.

 
 
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