Sept. 9 (Bloomberg) -- Bruce McMahan, a Connecticut-based hedge-fund manager who plans to start a fund in London, bought the pocket watch Horatio Nelson had with him when he died at the Battle of Trafalgar.

McMahan, who runs the Argent Funds Group, paid more than 350,000 pounds ($637,000) for the gold watch, made by Josiah Emery in about 1787, said Howard Leedham, an Argent managing director. He declined to name the exact price. The timepiece was to be auctioned at a sale by Sotheby's Holdings Inc. next month celebrating the 200th anniversary of the Battle of Trafalgar.

McMahan bought the watch partly to mark Argent's expansion into London, Leedham said in a telephone interview.

``Bruce was interested in the watch because he collects watches by Abraham Brequet, a contemporary of Emery,'' Leedham said in an interview. ``When Sotheby's told us there was a lot of concern about it going out of the country, Bruce said it's worth more to the British than to the Americans.''

Fund managers figure among the world's biggest art collectors. Connecticut-based hedge-fund manager Steven Cohen earlier this year paid $8 million for a shark pickled by U.K. artist Damien Hirst.

Argent, founded in 1995, runs about $3 billion of funds specializing in convertible arbitrage, equities, high-yield securities and oil and gas royalties, Leedham said.

New Trust

McMahan is traveling and couldn't be reached. He bought Nelson's watch through his new U.K. company, Argent Financial Group, and is setting up a trust to ensure it will stay in England for 100 years, Leedham said. The watch will be loaned out for Trafalgar celebrations and to museums, he said.

Nelson, who destroyed France as a sea power, is one of the U.K.'s most popular heroes. London's National Portrait Gallery has 64 images of him and at least five British museums have collections of objects showing his life and loves, according to SeaBritain's Web site.

To contact the reporter on this story: Linda Sandler in London at lsandler@bloomberg.net.

Last Updated: September 9, 2005 11:41 EDT