Alp Ercil, who used to head New York-based hedge fund Perry Capital LLC’s Asian operations, raised $940 million for his own distressed-asset fund, according to a person with direct knowledge of the matter.
Asia Research & Capital Management Ltd. told investors yesterday it won’t accept new capital, after capping the fund’s size at $1 billion, the person said on condition of anonymity because the information is private. Bill Wong, the Hong Kong-based company’s head of operations, declined to comment by e-mail today.
Ercil’s fundraising reflects increasing interest in alternatives to a traditional hedge-fund strategy in Asia of betting on rising and falling stocks, which has contributed to the region falling behind global returns in the industry, according to data compiled by Eurekahedge Pte.
The focus on distressed debt also follows a reduction in competition in the market due to commercial banks shutting proprietary trading desks, according to Richard Johnston, Asia head of Albourne Partners, which advises investors on hedge funds and other alternative investments.
The Eurekahedge Asian Hedge Fund Index gained 1.34 percent in the first seven months, trailing the 2.49 percent advance of the global Eurekahedge Hedge Fund Index. Fifty-nine funds that opened in Asia in the first five months this year raised an average $23.5 million at the start, according to the Singapore-based data provider.
The Asia Research & Capital fund invests in distressed assets such as credit and equity securities in the region, including Australia and Japan, three people with knowledge of the matter said in May. It attracted $440 million for the fund by its first subscription deadline then.
The fund has since drawn an additional $500 million, the person said today. About 10 percent of the money in the fund came from Asia Research & Capital’s partners, he added.
Reuters reported the fund size today.
Ercil, 39, is leading a team of 18 people, including the entire 14 staff from Perry Capital’s Hong Kong office, in the new venture. The fund charges a management fee, yet unlike a hedge fund, performance fees will be levied when investment gains are realized, the people said in May.
Ercil had been with Perry Capital for more than 10 years before leaving last year to plan his own fund. He moved to Hong Kong in 2005 to open Perry Capital’s office in the city.