By Svea Herbst-Bayliss
Sept 30 (Reuters) - New York-based hedge fund startup Raveneur Investment Group has signed up investment giants Blackstone Group LP and Pacific Alternative Asset Management (PAAMCO) as clients, according to sources familiar with the fund.
The fund has received $150 million from PAAMCO and is slated to receive $200 million from Blackstone according to the sources. Both Blackstone, which has seeded Marcato Capital Management and Senator Investment Group, and PAAMCO have a track record of spotting rising stars.
The cash infusion will be a boost to Raveneur founder and hedge fund veteran Mark S. Black, who is focusing his portfolio on Europe's sputtering recovery as well as event-driven opportunities in the United States, according to investors.
He particularly likes the financial and automotive industries in Europe, including Italy and Spain, according to the sources who asked not to be named.
"Throughout his career, Mark Black has made a lot of money for clients," said one investor who has known the 46-year-old founder for years. "He is just building the firm, but it could be compared to a firm like Baupost in its thought process and investing style," the person said, referring to Seth Klarman's hyper-successful hedge fund Baupost Group.
Despite the buzz, Raveneur is keeping a low profile, with Black rarely speaking in public and declining interviews. He did not respond to requests for comment.
LONG VIEW
Investors in the fund said that Raveneur is seeking to differentiate itself within the $3 trillion hedge fund industry by seeking longer investment horizons.
The firm plans to have between 20 and 35 names in its portfolio at a time and hold its investments between one and three years. It will invest across the capital structure and switch between owning both short- and long-term debt as well as common equity, the investors said.
So far neither Raveneur nor its investors have said what the firm holds. But because clients have committed roughly $400 million in assets, the firm will have to begin filing holdings data with U.S. regulators.
Black, who has an MBA from Stanford and previously worked at Tricadia Capital Management and Eton Park Capital Management, wooed industry veterans, including former Fortress Group chief financial officer Adam Rockfeld, to join the startup. Credit Suisse, Goldman Sachs and Morgan Stanley are its prime brokers.
Raveneur has signaled to investors that it plans to soft close before the fund hits $1 billion in assets, which would make it a small player compared industry titans like Baupost, which manages more than $20 billion.
But that may be a boon to its investors. Academic research has shown that newer and smaller firms tend to deliver better returns than the bigger established players.
Nonetheless, launching a hedge fund is a risky proposition. Last year 1,060 new funds opened and 904 closed down, Hedge Fund Research data show. (Reporting by Svea Herbst-Bayliss; editing by Richard Valdmanis and G Crosse)