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Hedge fund Magnetar lines up M&A portfolio

US-BASED hedge fund firm Magnetar Capital plans to launch an event-driven fund in coming months, said a source close to the firm, capitalising on investor expectations of a pick-up in mergers and acquisitions.

The fund will be managed by Alec Litowitz, who founded Magnetar in 2005 and specialises in this area, and will bet on M&A and other corporate events, the source said.

Magnetar, which manages around $7bn (£4.87bn) in assets, declined to comment.

Prime brokers said in March that event-driven funds – which returned 20.4 per cent last year and 6.74 per cent in the first four months of this year, according to Credit Suisse/Tremont -- topped investor wish lists and further launches were likely.