MFS Investment Management set up a new subsidiary, Four Pillars Capital, to provide seed and expansion capital to hedge fund managers, said spokesman John Reilly. MFS officials called the initiative the first step of the firms expansion into the alternative investment business.
The subsidiary will look to attract managers with successful records in need of seed capital as well as provide expansion capital to existing smaller hedge fund managers. Thomas A. Knott, a co-founder of hedge fund firm K Capital Partners, will be president, while Eric Lass, managing director and portfolio manager of K Capitals credit opportunities fund, will serve as CIO.
In a news release, MFS President and CEO Robert J. Manning said MFS is strongly committed to providing a range of alternative investing solutions to institutional clients. Amid recent market turmoil that caused some highly leveraged hedge funds to implode, Four Pillars will focus on hedge strategies that dont rely on extensive use of leverage or illiquid private securities to generate returns.