Tikehau Makes Maiden Credit Hedge Fund Offering

May 15 2007 | 10:21am ET

Paris-based Tikehau Investment Management in February launched its first hedge fund product, a long/short credit offering. To date, the Tikehau Credit Opportunities Fund is up 2.1% as of May 14 with €39.1 million (US$53 million) in assets under management.

The fund invests in bonds and loans, as well as credit default swaps, and uses options and futures to cover interest rate risks when needed, according to CEO Bruno Pampelonne. The focus is on European companies with €300 million (US$406.3 million) or more in enterprise value. “The long strategy is a bond picking, pure value approach play with an objective of having 60 to 80 names in the portfolio,” said Pampelonne.

“The short strategy is a macro short approach to the iTraxx, bond-picking playing on the high-grade names, which present some potential to go through MBOs, into the high-yield universe or names from the high-yield universe, which potentially could go into the distressed universe.”

Some names representing the fund’s main positions include VNU, the global media company, and Cirsa, a gaming concern. 

The new offering charges fees of 1.5% for management and 20% for performance, with a €100,000 (US$135,500) minimum investment requirement for Class A shares.

Prior to founding Tikehau last September, Pampelonne served as a managing director for Merrill Lynch Finance in Paris in charge of fixed-income activity, serving as country head for the group since 2003. Pamepelonne is joined by chief investment officer Yann Sequin, a former Merrill Lynch managing director, and CFO Guillaume Arnaud, a former director with Caisse d’Epargne Group, the French savings bank. 

The firm is currently managing some €100 million (US$135.5 million) in total assets.

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