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The Morning Brief: Barry Rosenstein’s Jana Sells 20% Stake to Dyal

Barry Rosenstein’s Jana Partners has sold a 20 percent stake to Dyal Capital Partners, a Neuberger Berman unit that has been buying up stakes in hedge fund firms. The investment provides Jana, an $11 billion, New York–based activist firm, with permanent capital that is not subject to sudden redemptions.

The firm’s Jana Partners hedge fund rose 3.7 percent last year, compared with 13.7 percent for the S&P 500 (including reinvested dividends), underscoring the difficult year experienced by many event-driven hedge funds. Its Jana Nirvana fund fared slightly better, gaining 0.5 percent in December and 5.8 percent for the year. This was the only year that fund did not post a double-digit gain in years when it has made money. Jana Nirvana, launched in 2007, is a more concentrated version of Jana Partners. The Jana Partners fund has produced a compounded annualized return of 13.3 percent since its inception — more than double that of the S&P 500 — while Nirvana has compounded at 12.3 percent, much better than the 7.2 percent gain posted by the benchmark.

“Dyal’s ability to leverage Neuberger’s platform to provide hedge funds with client introductions, consultant coverage, and other support services make them an attractive partner for hedge funds considering selling stakes in their firms,” states a June 23, 2014 memorandum from The New Jersey Division of Investment sent to the State Investment Council when it proposed making a second investment in a Dyal fund.

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Total hedge fund assets rose 2 percent last month, boosting the industry-wide total to $3.08 trillion, according to data tracker eVestment. Investors poured in $13 billion in new money, while February performance gains accounted for an additional $48.1 billion. Managed futures funds added $3.6 billion in new assets last month, boosting the total amount of inflows this year to $6.3 billion. Investors apparently have warmed up to the group after it posted its best year since 2008. Another case of buying high? We’ll find out by the end of the year. Investors also added another $3.1 billion to multi-strategy funds, bringing the total of new capital invested in the strategy this year to $7.4 billion.

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Philippe Laffont’s New York-based Coatue Management was among a small group of firms that invested a total of $170 million in Uxin, the large Chinese online used car auction company. Other investors include Baidu, the Chinese search engine, and New York-based private equity firm KKR.

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Alan Howard’s BH Macro fund is up 1.50 percent this month through March 13, bringing its gain for the year to more than 4 percent. The publicly traded fund invests most of its assets in the Brevan Howard Master Fund, which is managed by London-based macro hedge fund firm Brevan Howard Asset Management.

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