Gavea Scraps Asset-Backed Fund as JPMorgan Hires Away Berenguer

Gavea Investimentos Ltda., the hedge fund founded by ex-central banker Arminio Fraga, will return to investors the 1 billion reais ($507 million) it raised last month for a high-yield credit fund.

Gavea closed the fund because Jose de Menezes Berenguer Neto, who had joined the firm in March as head of private credit, is leaving to head JPMorgan Chase & Co.’s Brazilian unit, Gavea Chief Executive Officer Amaury Bier said by telephone from Rio de Janeiro. Gavea is a unit of JPMorgan.

Gavea won’t have another asset-backed receivables fund investing in high-yield credit until it finds someone to replace Berenguer, Bier said.

Valor Economico newspaper reported Gavea’s closure of the fund earlier today.

To contact the reporter on this story: Adriana Chiarini in Rio de Janeiro at achiarini4@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

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