Bloomberg News

Ex-FrontPoint Manager Foo Plans ‘Catalyst-Driven’ Hedge Fund

January 08, 2012

Jan. 6 (Bloomberg) -- John Foo, who ran FrontPoint Partners LLC’s event-driven fund in Asia, plans to revive the hedge-fund strategy in March after setting up Kingsmead Asset Management Pte in Singapore.

The Kingsmead Asian Alpha Opportunities Fund will trade stocks affected by company events such as mergers, privatization and divestiture of assets in Asia outside of Japan, Foo said. The principals will put in a “meaningful” amount of capital into the fund, with a capacity of at least $500 million, he said.

Asia-focused event-driven funds gained about 1 percent last year, compared with an average 8.6 percent loss reported by the region’s hedge funds, according to Eurekahedge Pte. The MSCI Asia Pacific Index declined 17 percent during the same period amid concern that the European sovereign-debt crisis would lead to a global slowdown.

“To make money in Asia and participate fully in the growth, you typically need to take at least a two-year view on an investment,” said Foo, 45, who was a fund manager in South Korea during the 1998 Asian financial crisis.

The manager plans to combine the fund’s long-short strategy with Warren Buffett’s value-oriented approach to investing in high-quality companies for long periods, Foo said in an interview. Kingsmead’s fund plans to hold onto some of its investments for one to three years, he said.

“If you invest in difficult times and take a medium-to- longer term view, the rewards will be great,” said Foo, whose hedge-fund bets produced a compounded return of about 9 percent a year from 2006 till 2010.

Foo managed more than $200 million of assets when he oversaw FrontPoint’s Asia event-driven fund from 2009 till last year. From 2005 till 2008, he led the Asian research for Indus Capital’s event-driven fund, which had assets of almost $1 billion then, he said.

The manager started Kingsmead Asset Management this week with three former mid- and back-office employees from FrontPoint to oversee functions such as trade execution and office support, he said.

--Editors: Linus Chua, Andreea Papuc

To contact the reporter on this story: Netty Ismail in Singapore nismail3@bloomberg.net

To contact the editor responsible for this story: Andreea Papuc at apapuc1@bloomberg.net


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