Merrion Launches UCITS-Compliant Hedge Fund

May 3 2010 | 10:45am ET

Merrion Investment Managers is throwing its hat into the UCITS III ring.

Not only is the fund, which debuted on April 16, Merrion’s first UCITS-compliant hedge fund vehicle, it’s also expanding beyond a few other comfort zones. The Merrion European Absolute Return Fund is the firm’s effort to attract investors beyond its traditional Irish base and its stable of traditional funds, HFMWeek reports.

The new fund, seeded with €20 million, is managed by former Pengana Capital managers Michael Nicol and Alistair McDonald. The vehicle employs a long/short equity strategy across Euripean markets, with a €250,000 minimum investment and fees of 1.5% for management and 20% for performance.

Merrion, which already boasts three long-only UCITS-compliant funds, is targeting the European Absolute fund at institutional investors. The firm is reportedly in talks with several British funds of hedge funds and pension funds, as well as several European banks about a distribution deal.

“We don’t see UCITS as a retail product,” Merrion business development chief Kevin Gallacher told HFMWeek. “Initially, we’re hoping to use it as another wrapper to deliver hedge fund strategies to institutional investors.”

Gallacher also said the fund is unlikely to be Merrion’s last UCITS-compliant hedge fund.

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