TWO London dealers who quit JP Morgan three years ago to set up their own hedge fund business clinched a deal today which values their firm at 420 million, writes Patrick Hosking.
Mike Platt and Bill Reeves have sold 25% of their BlueCrest Capital Management to Man Group for 105 million in Man shares and cash.
The ultra-private Platt, who is married with young children, built up a strong reputation at JP Morgan as a proprietary trader in fixed income investments before starting up on his own.
He and Reeves, an American, have built BlueCrest into one of the most admired hedge fund managers, achieving the difficult target of high returns combined with low volatility. Platt and Reeves are understoodto be majority shareholders. Several of the other 50 employees at the secretive firm in Grosvenor Square are also shareholders. BlueCrest manages $3.1 billion (1.8 billion) for clients, taking bets on interest rates, currencies and bonds.
Man’s chief executive Stanley Fink said the deal would give its clients preferential access to BlueCrest, which currently has a waiting list.
“BlueCrest is a super manager,” he said. Man is paying 33.3 million and 4.96 million new shares for the stake.
One associate described Platt as ” charismatic, focused and a gentleman”.
Dozens of bank proprietary traders have left their employers in recent years to set up hedge funds. Start-up costs are typically less than 5 million, which can be financed out of past bonuses.
