Egran Capital Group has recently launched its first hedge fund with $100,000 in assets under management. Evan Granovsky, managing partner of the Forest Hills, N.Y.- based fund, said the firm employs a strategy of betting on index spreads on the Standard & Poor’s 500.

DMS Asset Management is set to launch a micro fixed-income relative value hedge fund in the second quarter. David Sukoff, principal, said he is aiming to launch the fund with between $30-50 million in capital commitments and will hold a firm close when assets under management reach $100 million.

Roger Beutler is a principal at Saggezza Investment Management, which he co-founded with Patrick J. Morrell. The firm is gearing up to launch its first fund, a long/short fund-of-hedge funds, later this year. Beutler, who has years of experience in the financial industry working on manager selection, spoke with FINalternatives and told us what he looks for in a manager, what causes him to reject a manager, and why his new fund is unique.

By Deirdre Brennan 

President George Bush went on a widely-publicized energy tour this week, visiting three states to discuss his new energy initiative, which includes commitments to increase investment in clean technologies and alternative energies. Democrats blasted the tour as a “publicity stunt,” noting that only one day before the president’s tour of the The National Renewable Research Center in Colorado, a government grant for the facility that had been cut last month was partially restored.

Jefferies & Company has snagged a six-person team of industry veterans from Banc of America Securities to enhance its prime brokerage unit, which is a large provider of services to small- and mid-sized hedge funds.

By Deirdre Brennan 

The Canadian hedge fund industry has taken a few knocks over the past year with various scandals, most notably the collapse of Portus Alternative Asset Management and the sudden disappearance of its manager, Boaz Manor, who fled to Israel. But behind the splashy headlines lies another hedge fund story, one of a small but steadily growing industry.

By Deirdre Brennan 

Where some see chaos, Brian Riley sees opportunity. The managing partner of JB Investments Management, which opened up its fund to outside investors in September 2005 and now has $10 million in assets under management, puts a unique spin on distressed debt by targeting industry segments undergoing significant changes.

• Kleiner Perkins Caufield & Byers has closed its twelfth fund with $600 million in commitments. This includes $100 million which is being set aside specifically for green technologies. The firm has also raised $200 million for a later-stage fund that will focus on pandemic preparedness and bio defense.

The Tuono Corp. is readying to launch its first fund, a hybrid managed account product with hedge fund characteristics. The T-Circle Partners Fund, which will launch March 1, will invest in derivatives—both futures and options—and will be aimed at institutional investors that have a long-term perspective and who would like to invest in alternatives, but prefer the transparency and accountability offered by managed accounts.

Augustus Capital is gearing up to open its beta-neutral, quantitative, global, long/short equities fund to outside investors within the next two months. Mark Abeshouse, chairman of the Scarsdale, N.Y. firm, has been running the fund with his partner, a Dallas-based trader, for over a year with partner money.

The National Association of Securities Dealers is being sued by a Lehman Brothers employee who was one of 1,900 test taker who were wrongly told they failed their Series 7 exam.

According to a suit filed this week with the U.S. District Court in Manhattan, Andrew Crabbe said his annual bonus was cut and his reputation harmed last October when he was incorrectly told by the NASD that he had flunked the Series 7 exam.

BlackRock and Merrill Lynch reached an agreement Wednesday that will create a company with nearly $1 trillion in combined assets under management.

BlackRock will acquire Merrill Lynch Investment Managers from its parent company in exchange for an almost 50% stake in the combined company, which will retain the BlackRock name. The transaction has been approved by the boards of directors of both companies and is expected to close in the third quarter.

Investment advisory firm Ivory Asset Management and alternatives manager FrontPoint Partners ended their collaboration this week. The firms had been working together since mid-2003.

“Both firms have agreed to a separation plan that will result in a smooth transition of services from FrontPoint to Ivory and the uninterrupted management of several absolute return strategies by Ivory,” Ivory told FINalternatives.

The $1.4 billion Louisiana School Employees Retirement System and the $12.7 billion Teachers Retirement System of Louisiana are looking for private equity managers to handle a total of nearly $1 billion in assets.

By Deirdre Brennan 

John Dionne, chief investment officer of Blackstone Group’s newly-formed Distressed Securities Advisors Group and a senior managing director at the firm, has watched the industry evolve dramatically over the last decade and believes that institutional investors have finally come to accept distressed debt as an integral part of their portfolios.

Monarch Capital, a Charlotte, N.C.-based foreign exchange trading firm, is gearing up to launch its first hedge fund later this year. Clarkson Jones, founder and president, has spent the last five years honing his forex trading skills through managed accounts and feels that the time is right to offer a hedge fund product which he will run in a similar fashion.

The $245 million El Paso County (Colo.) Pension System has hired PIMCO and Western Asset Management to handle $11 million each in absolute return fixed-income. Dave Klemmer, plan administrator, said the two firms were selected because they complement each other, though he declined to detail how.

The $666 million Worcester (Mass.) Retirement System has hired hedge fund-of-funds managers The Blackstone Group and Aetos Capital to handle $10 million each. The other finalists were Ironwood Capital Management and Entrust Capital.

The Columbus Foundation of Ohio has recently reconstituted its investment committee and is in the process of doing an in-depth review of its portfolio. The committee, which controls the approximately $810 million foundation, is considering all asset classes, including alternatives.

The $40 billion Massachusetts Pension Reserves Investment Management Board will likely issue an RFP in April for portable alpha managers as a result of a new asset allocation. Mike Travaglini, executive director, said the board has approved a maiden investment into portable alpha of up to $2 billion. Funding for the portable alpha allocation will come from a portfolio rebalancing.