JPMorgan Plans Private-Equity Spin-Off

Jun 17 2013 | 2:40pm ET

JPMorgan Chase will spin off its internal private-equity unit, which manages some $4.5 billion of the bank's capital.

One Equity Partners, which until now has managed JPMorgan's money exclusively, will raise a new fund entirely from outside investors and will separate from the bank. One Equity will continue to manage the roughly 30 investments it currently has for JPMorgan.

The bank is shedding the unit due to recent uneven returns and a desire to focus on its core businesses. The spin-off has nothing to do with the Volcker Rule, which severely restricts banks' hedge fund and private-equity activities; because One Equity manages only JPMorgan's money, it could hold on to the unit under merchant-banking regulations.

"I am confident they will continue to be extremely successful," JPMorgan CEO James Dimon said in a statement.

JPMorgan acquired One Equity in 2004 when it bought Bank One Corp., deciding to hold onto it rather than its own private-equity business. But One Equity has lost money in four out of the last eight quarters, including a $182 million net loss in the first quarter.

Bank One set up One Equity in 2001 under Dick Cashen. Cashen, formerly president of Citigroup Venture Capital, is reportedly close to Dimon.

One Equity usually invests between $50 million and $250 million per transaction. It has nine offices around the world.


In Depth

Fundraising for Mid-Sized PE Funds: Should You Use a Registered B/D?

Dec 6 2016 | 7:18pm ET

When does a fund sponsor need to use a registered broker/dealer when raising capital...

Lifestyle

Trump Attends 'Villains and Heroes' Costume Party Dressed As...Himself

Dec 5 2016 | 11:16pm ET

U.S. President-elect Donald Trump attended a "Villains and Heroes" costume party...

Guest Contributor

A Hard Look At Your ‘Soft’ Hedge Fund Marketing Information

Dec 8 2016 | 9:03pm ET

Conventional wisdom holds that due diligence examines quantitative as well as qualitative...

 

From the current issue of

Since the inception of Modern Trader, a core editorial theme has centered on the wisdom and power of crowds. Editorial emphasis has focused on companies and projects engaged in the collection and analysis of information. 

AVAILABLE NOW at BARNES & NOBLE

NEWSTAND LOCATOR