SkyBridge To Launch Emerging Manager Hedge Fund

Jan 25 2008 | 11:45am ET

New York-based fund of emerging hedge fund managers SkyBridge Capital is diversifying its portfolio and launching a second fund to capture alpha from overseas emerging managers. FINalternatives has learned that the firm hopes to raise up to US$700 million for its Skybridge 2 fund, which will invest in as many as 15 underlying managers.

The fund already has $400 million in commitments from Asian and European investors and is making its debut on March 31, according to sources with knowledge of the firm’s capital raising efforts. “There is a huge institutional demand for people who want to have ownership in the hedge fund space,” sources said.

Like its predecessor SkyBridge Capital Partners and SkyBridge Capital funds, which raised a combined $330 million, the new offering will invest between $25 million to $50 million per manager. Sources say that the new fund may invest in an asset-backed securities hedge fund, an Indian-focused hedge fund and two other managers based in London and China.

“[Skybridge’s] brand is out there now and they’re getting a lot of reverse inquiries and incoming potential ideas. They want to look at high integrity, high money making managers with low egos, and are less concerned about where they’re located,” sources say. “These four managers are smart guys spinning out of larger firms who want to own their own businesses and control their own destinies, but want a good strategic partner alongside in the name of Skybridge.”

Skybridge 2 charges a 1.25% management fee and a 15% incentive fee with a $2.5 million minimum investment requirement. The fund also sports a three-year lockup period.

In addition, FINalternatives has learned that Skybridge has jettisoned its investment in Brompton Cross Capital Advisers, a long/short global equity hedge fund with a focus on the technology, media and telecommunications sectors, because the firm underperformed its benchmark, the NASDAQ Composite Index. Also, Skybridge is planning to open a new office in London by the start of the third quarter.

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