UPDATE: Mitsubishi Takes Stake In Hedge Fund

May 7 2008 | 11:33am ET

Japanese banking giant Mitsubishi Group has taken a 19.5% stake in Stamford, Conn.-based alternative asset manager Aladdin Capital Holdings. Contrary to yesterday’s media reports, the move was not a capital infusion, and it follows several years of successful deal-making between the two firms, including Mitsubishi’s investments into several of Aladdin’s investment vehicles.

Under the terms of the latest agreement, Mitsubishi will become the second largest shareholder in Aladdin Capital by investing $39 million to acquire a 19.5% position in the firm.

“We have always had the greatest respect for Mitsubishi and are very excited about this development,” said Amin Aladin, president of the alternative investment firm, which specializes in fixed-income strategies. “We view this commitment from Mitsubishi as a powerful vote of confidence in Aladdin’s ability to manage investments in a challenging market environment and look forward to a long and mutually beneficial relationship.”

In addition to acquiring a share of Aladdin, Mitsubishi will also commit $300 million to be used as seed capital for other Aladdin investment products.

According to Mitsubishi, the timing of the investment couldn’t be better.

“We are excited about our partnership with Aladdin because we feel it will provide us with an ideal platform to capitalize on the numerous opportunities created by recent dislocations in the market,” said Hideshi Takeuchi, executive vice president of the Japanese firm.


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