Fundraising was not supposed to be a problem for Portman Square Capital Management, the hedge fund founded by former Citigroup proprietary trading chief Sutesh Sharma. But the firm, which was supposed to launch its maiden hedge fund this month, has raised less than half of the $500 million it has sought.
London-based Portman Square has won about $200 million in commitments, Financial News reports. That amount is not enough for the fund, which was to launch on Nov. 1, to get under way, given the size of its team and the infrastructure it will employ.
Sharma had hired more than a dozen people to work at Portman Square, a multi-strategy relative-value fund expected to be among the largest hedge fund launches of the year. Among those brought on were almuni of Citi, Old Lane Partners, Brevan Howard Asset Management, Citadel Investment Group, ICAP Securities, Moore Capital Management and Morgan Stanley. Former Citi CEO Vikram Pandit was also rumored to be a potential new member of Portman Square, which has more than 10 partners.
Now, however, some of those employees are looking for new jobs and interviewing at other firms, according to FN.
Among Portman Square's fundraising problems include difficulties with a potential seeder. PineBridge Investments was to be a key strategic investor in the hedge fund, but talks between the two sides have ended.
"The Portman Square team is working hard to prepare the launch of its multi-strategy relative-value fund," Sharma told FN. "We have significant committed day-one funds from institutional investors and can also confirm that discussions with a number of potential strategic investors continue."