Temasek invests S$625 million in Dymon venture

SINGAPORE — Temasek Holdings has committed an initial US$500 million (S$625 million) to start a hedge fund seeding venture with Singapore-based asset manager Dymon Asia Capital, at a time when the Asian industry is starting to recover after six years of sluggish growth.

Temasek will become a minority stakeholder in Dymon as a result of the arrangement, the hedge fund said in a statement. Dymon president Jay Luo and managing director Ben Freischmidt will lead the new venture.

The capital will be used to seed new strategies and fund managers, and manage all non-investment functions to allow managers to focus on their trading activities.

The partnership will allow Temasek to diversify its investment and returns through a local company, and enable Dymon, one of Asia’s largest hedge funds, to add to its traditional business of running macro funds by providing non-investment services to help managers start their own pools.

“Temasek is as long-term and stable as it gets, and Dymon is a Singapore success story in the hedge-fund world,” said Mr Will Tan, a managing director at Singapore-based recruitment company Principle Partners, whose clients include hedge funds. “The strategic investment into Dymon bodes well for both parties as Temasek gets to diversify its investments using the Dymon platform and Dymon gets the backing of an established” state investment company.

The Temasek-Dymon venture’s first investment will be in a global equity long-short hedge fund focused on the Asia-Pacific region and led by former SAC Capital portfolio manager Carl Vine. Mr Vine plans to start the Port Meadow Fund in the third quarter.

Asia-focused hedge funds returned nearly 16 per cent to investors last year, their best annual performance since 2009, data from Eurekahedge showed. The industry also added US$20 billion in assets in 2013, its first growth in three years, according to AsiaHedge, which says the assets under management still remain about US$33 billion below the industry’s 2007 peak. AGENCIES