Man Group has agreed to acquire Pine Grove Asset Management LLC, a US-based fund of hedge fund manager specializing in the management of credit-focused hedge fund portfolios with approximately $1.0 billion of assets under management. The transaction is subject to customary closing requirements and is expected to close in the third quarter of 2014. Financial terms of the transaction were not disclosed.
Pine Grove is a credit-focused fund of hedge fund manager, founded in 1994, with offices in Summit, NJ and New York City. The firm is employee-owned, with senior investment professionals having on average 18 years of direct investment management experience. Since inception, the firm’s hedge fund selections and portfolio management have delivered attractive risk-adjusted returns across market cycles. Approximately two thirds of Pine Grove’s assets are from institutional investors, primarily US-based, with the remaining third from US high net worth individuals and family offices.
Pine Grove will enhance Man Group’s presence in the US and add to Man Group’s fund of hedge funds business, FRM. Pine Grove will also reinforce FRM’s efforts to offer clients a wide variety of investment opportunities including SEC-registered US 40 Act funds and complementary fund of hedge fund products.
After closing, Pine Grove’s investment philosophy, strategy and approach will remain unchanged, and the firm will benefit from Man Group’s robust institutional infrastructure. Matthew Stadtmauer, currently President of Pine Grove, will become President of FRM. Tom Williams, currently Pine Grove’s Chief Investment Officer will continue to be responsible for all investment decisions relating to Pine Grove’s portfolios and will join FRM’s Investment Executive committee.
Commenting on the transaction, Luke Ellis, President of Man Group, said, “FRM’s longstanding strategy has been to help investors use hedge funds to achieve their investment goals. Pine Grove has a long and accomplished track record of outperformance and is an excellent addition to the FRM business.” Michelle McCloskey, New York-based Senior Managing Director of FRM, said, “We look forward to working closely with our new colleagues with the aim to deliver positive risk-adjusted performance for our clients. The opportunity to expand FRM’s footprint in the US is extremely exciting.”
Matthew Stadtmauer, President of Pine Grove, stated, “Over the course of 20 years Pine Grove has built a well-received client-focused business model over multiple market cycles. We are now at the point in our evolution where the additional infrastructure, resources and support available at FRM will provide significant benefits to existing and future clients. We are delighted to be taking this highly progressive step for our business.”
Tom Williams, Pine Grove’s Chief Investment Officer, said “We are particularly excited about becoming part of FRM, which will provide us with world-class infrastructure, technology and resources, while allowing Pine Grove to maintain our entrepreneurial investment approach. This will enhance our business and add significant value for clients as we strive to create the optimal environment for our investment professionals to deliver performance.”