TPG-Axon Vets Commit To Investing In New Hedge Fund

Sep 17 2010 | 6:34am ET

When Soroban Capital Partners launches its maiden hedge fund in November, much of the money it manages will come from its partners.

The New York-based firm, led by former TPG-Axon Capital partner Eric Mandelblatt, is currently fundraising. It is unclear how much the firm will be able to raise in a difficult environment for start-up hedge funds, but Mandelblatt hopes his own faith in the firm will reassure potential investors.

“The partners of our firm expect to be one of the largest investors, and each of us will invest a material portion of our liquid net worth in the fund,” Mandelblatt wrote to prospective clients this week.

Those partners now include Steve Johnson, formerly head of business development at Highbridge Capital Management, MarketWatch reports. He joins Mandelblatt and two other TPG-Axon veterans, Gaurav Kapadia and Scott Friedman, and former Kailix Investment Advisors CFO Vito Tanzi. All told, Soroban will employ 14 when it debuts on Nov. 1.

Soroban will invest in U.S. and European stocks.

“We see a very attractive opportunity set in global financial markets today and we believe our fund launch is well timed,” Mandelblatt wrote. “Equity-market correlation has been exceedingly high over the past few quarters, and dispersion exceedingly low, laying the foundation for a strong ‘stock-pickers’ market.”

“Our ability to invest in small- and mid-cap stocks, in addition to large caps, provides us a greater ability to generate alpha on both sides of our balance sheet in a world where hedge-fund industry assets increasingly have gravitated toward larger-sized firms,” he added.

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