search   Knowledge Bank printable version
 Knowledge Bank
 Deal Information
 Industry Events
 Advocacy Forums
 Site Utilities
 Free Offers

Click here to
Update Registration

Please be advised that the use of ®
is subject to the
Terms & Conditions

of use and the
Privacy Policy


Best viewed in

Knowledge Bank > Hedge Funds
Select an area

FREE Three-week trial of Asset-Backed Alert's newsletter

Gottex to Debut With Hedge Fund Offering
Asset Backed Alert, Harrison Scott Publications Inc. (August 19, 2005)

Alternative-investment shop Gottex Fund Management wants to sell bonds tied to hedge funds.

The collateralized fund obligation is slated to hit the market via underwriter Lehman Brothers sometime before December. It will likely weigh in at $300 million to $500 million.

Details are sketchy, but if the offering follows the usual pattern, it would function like a so-called fund of funds - except that it would raise money selling both notes and equity. However, the vehicle could invest in loans to hedge funds instead. Either way, such a transaction would seem to be a natural fit for Gottex, which routinely analyzes hedge funds. The firm's main line of business is setting up and running alternative-investment products that invest in those vehicles.

Gottex is based in Lausanne, Switzerland, but it's likely that the firm's New York team is the one working on the deal. If that's the case, structured-product chief Steve Oristaglio is probably involved. He joined Gottex in late April, about two months after giving up his post as Boston-based Putnam Investments' head of investments.

Oristaglio's arrival was part of a larger effort to broaden Gottex's investment-product offerings, chief executive Joachim Gottschalk declared at the time. The firm also wants to double its assets under management within five years, to $10 billion, he said.

Collateralized fund obligations, an outgrowth of the once-dormant field of market-value collateralized debt obligations, have caught the eye of many prospective issuers over the past few years. The deals' relatively low cost of funding is among their main draws. The products can also be attractive to investors because they give bondholders exposure to a variety of hedge funds that they might not be able to access directly.

But actual deals have been few and far between. The transactions can be a tough sell because many traditional CDO buyers are fuzzy about how to evaluate them. And the underlying hedge fund managers usually don't help, since they are notoriously secretive. Potential investors also worry that it would be difficult for the securitization trust to get out of hedge funds that run into trouble.



© Copyright 2014. The Mayer Brown Practices. All rights reserved.

Mayer Brown is a global legal services provider comprising legal practices that are separate entities (the “Mayer Brown Practices”). The Mayer Brown Practices are: Mayer Brown LLP and Mayer Brown Europe – Brussels LLP, both limited liability partnerships established in Illinois USA; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales (authorized and regulated by the Solicitors Regulation Authority and registered in England and Wales number OC 303359); Mayer Brown, a SELAS established in France; Mayer Brown JSM, a Hong Kong partnership and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. “Mayer Brown” and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

Legal Notices | Attorney Advertising | Site Index | Contact Webmaster

*The site links listed on this web site are for reference use only.
The firm does not necessarily sponsor, endorse or verify the accuracy of the content contained in any of these sites.