PC: Yahoo! Finance
Dubai-based Magellan Capital Holdings Ltd. is priming a $700 million multi-strategy hedge fund for launch next month in one of the largest hedge fund launches in the United Arab Emirates, helping further its reputation as an increasingly prominent destination for major financial initiatives.
Fund Details and Strategies
The new hedge fund, according to Magellan’s head of long-short equities, Britney Lam, will utilize both equity and credit strategies to generate diversified returns through rigorous risk management. The size of the fund is significant, with only 5% of hedge funds around the world this year launching with $500 million or more, based on industry tracker Preqin.
Seed Capital and Founder’s Background
The seed capital of this fund is derived from the family wealth of Hassan El Ali, founder of Zakher Marine International. Two years ago, El Ali sold the company to Abu Dhabi National Oil Co., a state-energy company of UAE, thereby providing the enormous financial support to Magellan Capital Holdings Ltd.
Investment Strategy and Future Plans
Britney Lam has said that the firm is going to spend the next 12 months building a track record before the bigger allocators, such as family offices and sovereign funds, are approached. Underpinning this investment process will be the more conservative approach, which will be more stable before significant external capital is attracted.
Dubai’s Hedge Fund Landscape
This hedge fund will also contribute to Dubai’s already established reputation as one of the world’s top hedge fund centers. The city hosts local operations of 37 global hedge funds, each with at least $1 billion under management. Among those, as many as 25 were established after 2022, thus underlining Dubai’s recent rise as a financial hub.
Company Growth and Key Hires
Magellan Capital Holdings Ltd. has been growing its team aggressively, up 100% in the past year to more than 20 employees within its public and private markets operations. One of the key hires is Valery Kazak, formerly of Sova Capital in London, who takes on a new role overseeing emerging markets fixed income.
Financial Background and Recent Activities
The recent sale of Zakher Marine provided Magellan with $1.1 billion for investment, a significant boost to the firm’s financial resources. In June, the firm agreed to a major acquisition, paying more than €700 million for Danish Ship Finance. Shortly thereafter, Magellan raised $360 million in a bond offering to support the acquisition.
Historical Context and Naming Inspiration
Magellan Capital Holdings Ltd.—the name is a nod to Ferdinand Magellan, the Portuguese explorer who first circled the globe more than 500 years ago—suggests a global focus, much like other funds, including the Fidelity Magellan Fund and Australian Magellan Financial Group Ltd., which manages $25 billion.
The ambitious launch of the hedge fund by Magellan Capital Holdings Ltd. will be remembered for a long time as the moment Dubai really arrived on the financial scene and marked its place in the global hedge fund industry. Backed by massive support, strategic plans, and a growing team, Magellan is all poised to make a big bash in the financial world.
