HedgeCo.Net

Telegraph.co.uk – The hedge fund, which has $11bn (£6.7bn) of assets under management, will be the cornerstone investor in the new company called Lothian which will buy oil assets around the world and manage them. The plan is for Lothian to have a market value of as much as $500m.

GLG, which is listed on the New York Stock Exchange, is helping to put together a management team for Lothian that includes Tom Hickey, the former finance director of Tullow Oil, John Kennedy, chairman of Wellstream Holdings – the Newcastle-based manufacturer of pipes for the oil and gas industry – and Andrew Knott, a former analyst at Merrill Lynch who joined GLG last year. It is thought they are looking for one more high-profile director before the flotation.

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Tags: andrew knott, assets-under-management, cornerstone, finance director, glg, hedge fund, john kennedy, lothian, management team, merrill-lynch, new-york-stock, new-york-stock-exchange, newcastle, oil and gas, oil and gas industry, oil assets, pipes, telegraph, tom hickey, york-stock-exchange

BusinessWeek – Macquarie Capital Group and State Bank of India (SBI) plan to raise a new $2 billion fund that will invest in direct infrastructure investment opportunities in India.

Macquarie and SBI have signed a memorandum of understanding to set up a company and manage the proposed fund. The International Finance Corporation (IFC), as one of the fund’s cornerstone investors, will also have a stake in the proposed company.

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Tags: bank of india, businessweek, capital-group, cornerstone, ifc, infrastructure investment, international finance corporation, investment-opportunities, investors, macquarie, memorandum of understanding, sbi, stake, state bank, state bank of india

Financial Times – The US Federal Reserve will launch its financing ­programme, worth up to $1,000bn, for consumer and business loans in the coming days, amid concerns that hedge funds might find it difficult to take advantage of the scheme.

The programme – the term asset-backed securities loan facility (Talf) – is the cornerstone of the US authorities’ push to jump-start the credit market. Officials at the central bank say it will be up and running by the end of this month.

Fed and Treasury officials say this is an essential complement to efforts to repair the banking system. The idea is to boost the supply of new credit-card loans, student loans and car loans by providing low-cost finance to investors who buy these loans bundled up as securities in the secondary market.

But the Talf relies on private-sector investors being willing and able to take advantage of the financing the Fed makes available.

Consultations have revealed potential obstacles to participation. The most significant of these are limits on the ability of investors who use Talf finance to buy an asset to transfer the loan when they sell it.

An asset sold with low-cost three-year financing attached would command a higher price than an asset that had to be financed in distressed private markets at the point of sale.

Moreover, most hedge funds do not have permanent capital so they have to consider the risk that redemptions could force them to sell the assets before the three years are up.

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Tags: asset backed securities, banking system, business loans, car loans, consultations, cornerstone, credit card loans, federal-reserve, financial times, loan facility, obstacles, point of sale, private markets, private sector investors, redemptions, securities loan, student-loans, treasury officials, us-federal-reserve