Senrigan Capital Group Ltd., an Asia-focused event-driven fund backed by Blackstone Group LP (BX), lost almost 15 percent in the first six months of this year, according to a performance estimate sent to investors.
Senrigan Master Fund’s net-asset value fell 6.7 percent in June, according to the update earlier this month that didn’t give a reason for the decline, and which was obtained by Bloomberg News. Its assets dropped to about $754 million at the end of June, according to the document, after topping $1 billion at the start of the year.
The European debt crisis and worries about a global economic slowdown have shaken stock markets globally and prompted companies to delay big acquisitions. The value of announced mergers and acquisitions involving an Asia-Pacific region company totaled $303.4 billion in the first six months, 16 percent less than a year earlier and the lowest since the first half of 2010, according to data compiled by Bloomberg.
Event-driven funds invest in securities whose prices are affected by corporate actions such as mergers and reorganizations. They require a meaningful mispricing, with a clear catalyst, in a size appropriate to the fund, said Peter Douglas, principal of Singapore-based GFIA Pte., which advises investors seeking to allocate money to hedge funds.
“The meaningful mispricings are clearly there, but the macro-driven markets that have dominated since 2009 and continue to dominate are making issuer-specific catalysts unreliable,” said Douglas. “With fickle market liquidity, size is a handicap as it constrains the number of opportunities available.”
Katarina Bendle, Senrigan’s investor-relations officer in Hong Kong, declined to comment.
The estimated June decline was the largest single-month loss for the Senrigan fund, according to the document sent to investors. It lost 8.7 percent last year after a 5.9 percent gain in 2010, the first full year after trading started in November 2009, according to the document.
The Eurekahedge Event-Driven Hedge Fund Index fell for the fourth-straight month in June, cutting the year-to-date return to 1.4 percent. The gauge slipped 4.6 percent last year.
More than 30 mergers and acquisitions involving Asia- Pacific companies announced earlier this year have been terminated, according to data compiled by Bloomberg. About $204.9 billion worth of such deals were brought to completion in the first half, making it the slowest six months in three years, according to the data.
Blackstone has invested at least $150 million with Senrigan. The Hong Kong-based manager was started by Nick Taylor, former head of Citadel LLC’s principal investments business in Asia and Europe in 2008. Most members of its investment team had worked together at Modal Capital Partners, a hedge-fund unit of Credit Suisse Group AG that Taylor helped set up in April 1999.
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