AG Asset Management, the traditional equity affiliate of hedge fund veteran Angelo, Gordon & Co., is closing.
Its core equity portfolio management team, based in Boston, is slated to join Evercore Asset Management, and its New York-based growth teams will join Palisade Capital Management by Jan. 31, according to investment consultants who declined to be named.
Terms of the deals weren’t disclosed.
In a letter to consultants forwarded to Pensions & Investments, Dana C. Troxell Jr., AG Asset Management’s president and CEO, said the decline in equity markets this year had set back the prospects of “achieving appropriate scale for our firm over a reasonable period of time.” One consultant, who declined to be named, said the market’s plunge had left the boutique with about half of the $2.6 billion in client money it was managing at the end of 2007.
In a telephone interview late Monday, Mr. Troxell said: “This was a difficult decision, but one we implemented in line with our culture of putting clients’ interests first. … We’re pleased to have been able to provide clients with a seamless option to continue working with the investment professionals they’ve known for so long.”
Gail S. Landis, managing principal, marketing & client service, with New York-based Evercore, confirmed that AG Asset Management’s core equity team — Managing Directors Christopher J. Fasciano and Timothy D. Buckley, and Directors Michael P. Evans, Susan S. Hager and Ray Lewis — will join Evercore. She said the core team has an excellent track record, and shares a bottom-up, research-driven approach to portfolio management with Evercore’s value equity team.
According to eVestmentAlliance, AG Asset Management’s core team had roughly $250 million in client assets under management as of Sept. 30, at which time it reported the firm was managing $1.84 billion.
Neither Jack Feiler, Palisade president and CIO, nor Bradley R. Goldman, the firm’s general counsel, responded to calls seeking comment. The growth equity team was managing about $1.6 billion as of Sept. 30, according to eVestmentAlliance.
In May 2006, Angelo, Gordon & Co. acquired AG Asset Management, formerly known as ForstmannLeff LLC, together with the firm’s management team. At the time, John Angelo, the CEO of Angelo Gordon, noted that “institutional clients are driving a convergence of traditional, long-only investment managers with alternative investment managers.”
In his letter to consultants, Mr. Troxell said the decision to close AG Asset Management would have “no effect on the strong alternative investment management business of Angelo, Gordon & Co. or Angelo, Gordon Advisors.”