Law firm White & Case has launched a new regional team, the Asia Investment and Hedge Fund support Group (AIHFSG), in an effort to provide a comprehensive service to Asia's bourgeoning hedge fund and private equity community.
The move has been prompted by the firm's belief that Asia is set for the next wave of hedge fund and asset managed investment launches.
"Throughout Asia concerns over liquidity and regulation are diminishing and players other than just the traditional large financial intermediaries are entering the funds management market," says Christopher Wells, a White & Case partner in Tokyo who chairs the regional group. "Asian markets are rapidly maturing in the alternative investment area in the same manner as US and European markets in the late 1980s and 1990s."
With operations in Tokyo, Hong Kong, Shanghai, Singapore and Bangkok, and a team consisting of over 20 lawyers, the group will provide legal advice on areas such as fund structuring, tax issues and regulatory requirements for intermediaries and offerings.
"The purpose of creating the new group is to help us pool the internal talent we have so we can bring our full expertise to bear to advise both our alternative investment and traditional fund clients," explains Wells. "For example, our partners in Tokyo have had more experience with hedge fund starts ups, whereas our Hong Kong partners have more experience with large fund JVs and traditional asset classes."
He says AIHFSG seeks to stand out by providing clients with quick turn around times and competitive rates combined with true understanding of their business.
He adds that with more Asian hedge funds looking to market in the US as well as Europe, White & Case is well positioned to advise them as the team has strong US and UK domestic and tax law capabilities.
Wells says that the need for real time information from Asia has encouraged new start ups as well as larger US funds to set up operations on the ground in Asia, with a number launching Japan focused strategies. In addition he points out that the Asian hedge fund market is showing increasing signs of maturity as ex-proprietary desk traders begin to launch macro and arbitrage funds, diversifying away from the traditional long/short funds that have dominated the Asian space.
Wells says Japan in particular has encountered a boom in new launch activity. "This has been encouraged by Japanese institutional investors, who are keen to enjoy higher returns and have become increasingly sophisticated when selecting their managers," he says.
Sharon Hartline, head of the Hong Kong funds desk says that another trend is the introduction of secondary opportunity funds in Asia, set up to take advantage of private equity funds seeking to divest portfolio companies, or private equity investors desiring to divest their fund interest. "These funds bring together a mix of hedge fund and private equity investment strategies and require sophisticated legal, regulatory and tax advice," she says.
In China, Victor Ho, head of the Shanghai desk expects to see significant growth of managed funds in China at the retail and institutional level. "We are also seeing a lot of activity in the private equity space, including distressed asset and real estate investment areas."