The global merger & acquisition business is primed for a bumper year, sitting at $1.2 trillion worth of deals in the year-to-date, according to industry figures.
This is the highest level since 2007 and up 42% on one year ago. But who is capitalising on this uptick?
Citywire Global has uncovered the leading managers in the Citywire Alt Ucits Event Driven sector, to find out who has been benefitting from these situations.
Over the three years to the end of March 2014, the average manager in this 17-strong sector returned 7.72%. Among this peer group, just five outperformed the average return. So who beat the competitors? Let’s take a closer look at the best performers.
3. Henri Jeantet, Siquant Capital
Fund: Helium Opportunites A
Total return (April 2011 – March 2014): 10.31%
Posting the third strongest performance over this analysis period is Citywire + rated Henri Jeantet of Paris-based boutique Syquant Capital. He manages the Helium Opportunities A fund and returned 10.31% over the last three years.
The fund targets absolute returns uncorrelated to equity markets through equity arbitrage strategies. It invests in liquid assets and combines a conservative management style with low leverage.
In his latest market commentary, Jeantet said macroeconomic events had dominated investments in March, especially the return of the emerging markets and the possible quantitative easing from the ECB.
‘The microeconomic front also experienced a major shift as investors rotated their portfolio out of growth stocks, especially in the tech sector, and into defensive and large cap stocks,’ he said.
2. Frédéric Haym and Thibaut Sciard, Delta AM
Fund: Delta Prime ESSF
Total return (April 2011 – March 2014): 11.11%
The Delta Prime ESSF fund aims to deliver a 8% net performance per year on a five-year time horizon. It is mainly invested in fixed income (73.54%), with a considerable amount of cash and other instruments (19.21%) and marginal number of stocks (7.25%).
The fund is focused on distressed and special company situations, with an emphasis on liquidity, with 57.5% of assets having less than three years to maturity. It currently holds 15.94% of assets which are rated Caa1 by Moody’s.
Meanwhile, on a geographic basis, the majority of the fund's allocations are to the French market (28.65%). This is ahead of exposure to other European market, such as Germany, Spain and Portugal.
1. James Dinan and Daniel Schwartz, York Capital Management
Total return (April 2011 – March 2014): 23.51%
The MLIS York Event-Driven UCITS EUR A fund is primarily exposed to equities and currently holds 102 long positions and 12 short positions. Among its major holdings are American Airlines, T-Mobile and Constellium. The largest long positions on a sector basis are held in consumer discretionary, industrials and financials.
In the fund literature, Dinan and Schwartz state the fund is focused largely on arbitrage opportunities, as well as special and distressed situations.