KKR looks to extend its reach with hedge fund

Madeline Ratcliffe
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NEW YORK investment giant KKR yesterday announced it was buying a 24.9 per cent stake in London-based hedge fund Marshall Wace.

Continuing Tuesday’s glut of M&A, KKR said in a statement it had acquired the minority stake with a combination of cash and shares, with the option to increase the ownership interest to 19.9 per cent.

The agreement was for an un­disclosed sum, but according to a regulatory filing by KKR, the company will issue 7.4m shares for the sale, worth $139.9m (£91m) at yesterday’s closing share price.

The majority of the remaining cash shares will be invested in Marshall Wace-managed funds.

All Marshall Wace’s capital partners have signed long-term agreements, and the company said its investment strategies would remain unchanged.

Ian Wace, chief executive of Marshall Wace, said: “Over the last few years, we have been approached by several firms looking to invest in our business, but KKR offered something different: a true, long-term partnership.”

Founded in 1997 by Paul Marshall and Ian Wace, Marshall Wace has approximately $22bn (£14bn) under management as of the beginning of August 2015. Its most recent financial filings show the hedge fund made profits of £205.3m in the year ending 28 February, up from £83.6m in the previous 12-months.