Vision sells Angel Fund management to Samena

Samena Capital adds $75 million Vision Asia Pacific to its $50 million of capital seeking to acquire asset managers in emerging markets; Vision meanwhile is building investor relations in the West.

Samena Capital has established a presence in Hong Kong via the announced acquisition of Vision Asia Pacific, a subsidiary of Vision Investment Management managed by Julius Wang responsible for the $75 million Angel Fund.

This means Samena, a recently established investment management group, is now "ready for business" in terms of driving a pan-Asia business strategy, says Shirish Saraf, president and founder in London.

Officials at Vision declined to discuss the deal. Jerry Wang, Vision's founder CEO and CIO, will join Samena's board and Vision will become a shareholder. Vision will continue its core business as a manager of funds of hedge funds.

(Vision Investment Management says it is expanding its fund of funds business by hiring three people for business development and client service in Europe and the US. For the first time it has hired someone in New York dedicated to covering North American institutional investors: Edward den Dooven, who was previously director of marketing for Vermillion Asset Management.

(In London, Vision has made two hires. Elina Tsomik will cover European institutions. She previously headed investor relations and marketing for a large event-driven hedge fund which Vision declined to name. Salman Shah will cover investors in the Middle East and Italy, having served previously as a product specialist in UBS's alternative and quantitative investments group. Tsomik and Shah join an existing director of investor relations at Vision in London, Candida Lahaise, who joined in January.)

Shirish Saraf, who in 2002 co-founded Abraaj Capital, explains Samena Capital was established last February to take advantage of changes in the asset-management industry in a changing world, which has seen power and wealth shifting away from the US and Europe. This suggests traditional asset managers, whose businesses are Western-centric, must shift their orientation or lose out.

The result is Samena, a collective investment model run by entrepreneurs based in the Subcontinent, Asia, the Middle East and North Africa (hence the name Samena).

"These markets will continue to gain momentum over the next 10 years," Saraf says. "It's not just the China or India story but the integration of businesses among them." Adding that he and other founders of Samena foresaw distress striking Western finance (albeit not this badly), they sought a platform to buy and build asset-management capabilities focused on the emerging world. The ambition is not modest: "We're reinventing the model," Saraf says.

The firm consists of 25 or so entrepreneurs involved in $1 billion-plus investment businesses who understand not only how to manage money, but how to integrate companies and processes, in order to create value in areas such as distribution and IT. This coterie of experienced entrepreneurs are not passive limited partners to a closed-end fund, but look at deals together and work in partnership with investee companies.

The first step was the August 2008 launch of a $200 million special situations fund. To date, 25% of its capital has been deployed and it has returned 32% since inception.

Second was the launch earlier this year of a Japan equity long/short strategy.

Now, step three, is to create a capital reserve of $50 million intended to acquire asset managers and consolidate them. Acquiring Vision Asia Pacific is the first realisation of this strategy, and serves as Samena's means of developing a pan-Asia platform.

"The days of backing a trader who would grow a huge portfolio are limited," Saraf predicts. "This is about acquiring asset-management teams of quality." He says Samena is on the hunt for stable, mature investment teams, or for teams that proved strong performance during a difficult 2008: "It's easier to take an asset manager from 20 to 100 [in terms of millions of dollars under management] than from zero to 20."

Samena is keen on both traditional and alternative funds, including those in private equity or real estate, provided their geographic focus fits.

The Angel Fund, which invests in early-stage fund managers, has done well during the financial crisis, Saraf says, with a positive return in 2008 (undisclosed).

The idea behind the acquisition is to take Vision Asia Pacific "to the next level", Saraf explains. This entails replacing Vision Investment Management's seed capital with Samena's, to the tune of $10 million, and combining forces to institutionalise the funds, acquire others, integrate them, and expand distribution. Samena argues that asset managers can no longer assume track record alone will help them raise money; rather they need strategic partners to help them grow their businesses.

For example, Saraf says the funds being seeded by the Angel Fund have good performance but have struggled to raise additional capital. Samena's partners have the relationships and experience to help these investee firms expand their distribution and raise money. And Samena's entrepreneurs can help these investee funds improve things like technology and platforms. "We can make it more profitable," Saraf says.

With Jerry Wang sitting on Samena's board, and with Vision Investment Management as a shareholder, Vision Investment Management will also continue to support the Angel Fund's investee companies. Meanwhile, Julius Wang now has more capital and access to relationships to seek out good companies to acquire or invest in.

Saraf cites his own experience as the kind of entrepreneurialism shared by Samena's partners. He co-founded Abraaj and served as managing director for its first three years. He ran its private-equity business and special-situation funds. He also founded and ran Oriel Investments in the UAE, a corporate finance firm; ran direct equity investment and syndication activity in the Gulf at Bahrain-based TAIB Bank; and founded the first foreign Sebi-approved merchant bank in India, TAIB Capital.

Julius Wang joined Vision in 2006. Previously he started the Asian investment operations for a US-based multi-strat fund and also managed a multi-billion dollar portfolio of hedge funds at Search Partners. He has seven years of private-equity experience investing in companies throughout Greater China, and has been based in Hong Kong since 1994.

Samena Capital's CIO is Ramiz Hasan, who founded Japan-focused hedge fund Invicta Investment Management in 2000, and also managed a $1 billion portfolio at Hermes Pension in London.

Other founders at Samena include: Atul Punj, Samena's chairman and founder of Punj Lloyd, an Indian engineering and construction company; Yeh V-Nee, co-founder of Value Partners in Hong Kong; Gratian Anda of IHAG Holdings in Zurich; Colin Rutherford of Midas Capital in the UK; Sheikh Ziad Abdul Rahman Al Turki of Saudi Arabia's Atco Group; Samir Fancy, chairman of Tawoos Group in Oman; Sheikh Nawaf Nasser bin Kahhd al Thani of NBK Group in Qatar; Sheikh Kamal Bahamdan of Saudi Arabia's Bahamdan Group; and Simon Wong, previously of GC Partners and Lancea Partners, and also a board member at Invicta.

¬ Haymarket Media Limited. All rights reserved.