Scaramucci scores millions from a buyer with mystery investors
Skip to main content
pilogo-NEW
Subscribe
  • Subscribe
  • My Account
  • login
  • NEWS
    • Asset owners and the coronavirus
    • Alternatives
    • Consultants
    • Coronavirus
    • Defined Contribution
    • ESG
    • Frontlines
    • Hedge Funds
    • Investing / Portfolio Strategies
    • Money Management
    • Pension Funds
    • People Moves
    • Private Equity
    • Real Estate
    • Searches & Hires News
    • SECURE Act
    • Special Reports
    • WorldPensionSummit
    • Ron Schmitz
      Pandemic drives faster transition for Virginia to private markets
      Mubadala Investment Co. logo
      Mubadala draws on portfolio in coronavirus fight
      T.J. Carlson
      Texas Muni reduces downside risk during pandemic, finding opportunities now
      Scott Davis
      ‘Triage plan’ at Indiana system helped stem losses
    • Jeffrey Epstein and Leon Black
      Apollo Global CEO Leon Black to retire after Epstein review
      Coller Capital collects $9 billion with latest secondaries fund
      Directional signs respresenting types of traditional and alternative investments
      Setter: Alternative secondary deals drop 27.7% in 2020
      Kennedy Lewis raises $2.1 billion for latest opportunistic credit fund
    • Bill Foley
      Foley-backed SPAC agrees to $7.3 billion deal with Alight
      Jason Schwarz, chief operating officer of Wilshire,
      New owners have big plans for future of Wilshire
      Amy Hsiang
      Meketa picks new public markets manager research director
      Will Martindale
      Cardano Group chooses group head of sustainability
    • World economic growth ‘a race between a mutating virus and vaccinations’ – IMF
      Fred DeSerio
      Commentary: A new era for manager due diligence
      CalSTRS participant retirements jump in second half of 2020
      Mexico manages breakthrough in virus-marred year
    • Signage outside the Blackstone Group Inc. headquarters in New York on July 13, 2019
      Blackstone to sell Alight to SPAC in $7.3 billion deal
      Joni Tibbetts
      Principal counts on advisers to get word out on PEPs
      Jan Jacobson
      High-court ruling thwarts ERISA stock-drop lawsuits
      Kenneth J. Munro III
      Empower names new national sales director
    • BlackRock’s Fink urges others to join in net-zero commitment
      Global business leaders commit to stakeholder metrics
      Emissions rise from a coal-fired power plant
      NYC pension funds to divest fossil fuels
      A Eurosystem monetary authority sign outside the European Central Bank headquarters in Frankfurt on March 7, 2019
      ECB considers going greener in staff pension fund
    • Hawk's Nest dam
      Brookfield donates golf course for firefighter training center
      Gifford Fong
      Old ties help bring local version of JOIM to mainland China
      Ryan Tedder
      Strike up the band: KKR fund takes majority stake in Ryan Tedder catalog
      Helen Dean
      NEST’s Helen Dean earns U.K. recognition for service
    • Gabe Plotkin, chief investment officer and portfolio manager of Melvin Capital Management, speaks during the Sohn Investment Conference in New York on May 6, 2019
      Citadel, Point72 back Melvin with $2.75 billion after losses
      Shanghai skyline
      Global hedge funds struggle even in a more open China market
      The Sun Hung Kai Properties Ltd. logo is displayed on the Sun Hung Kai Centre building in Hong Kong on Sept. 13, 2018
      SHK spins out East Point Asset Management
      Man holding a business card with Hedge Fund written on it
      Hedge funds chalk up decade’s best returns in 2020 – HFR
    • Rice endowment returns -0.7% for fiscal year
      Earnings key driver of public pension revenues – study
      Rutgers rides to 0.2% return in fiscal year
      Leon Black, chairman and chief executive officer of Apollo Global Management at the annual Milken Institute Global Conference in Beverly Hills, Calif., on April 27, 2015
      Black hangs on at Apollo as Epstein links cost him CEO role
    • River and Mercantile chooses head of infrastructure
      Leon Black, chairman and chief executive officer of Apollo Global Management at the annual Milken Institute Global Conference in Beverly Hills, Calif., on April 27, 2015
      Black hangs on at Apollo as Epstein links cost him CEO role
      Paul Schofield
      NN Investment Partners adds head of sustainable and impact equity team
      CI Financial to acquire Segall Bryant
    • Earnings key driver of public pension revenues – study
      Canadian plans cap 2020 with 10% annual return – Northern Trust
      CalSTRS participant retirements jump in second half of 2020
      A sign outside California Public Employees' Retirement System headquarters in Sacramento
      CalPERS expecting to announce new CIO this quarter
    • River and Mercantile chooses head of infrastructure
      Ingrid Jacobs
      Jones Lang LaSalle brings on head of diversity and inclusion
      Paul Schofield
      NN Investment Partners adds head of sustainable and impact equity team
      Jeffrey Epstein and Leon Black
      Apollo Global CEO Leon Black to retire after Epstein review
    • Pension funds continue private equity investing spree
      Big jump in private equity AUM expected over next 5 years
      Thoma Bravo takes in $22.8 billion for 3 funds
      Jason Thomas
      Data, technology become new prized possessions
    • Ingrid Jacobs
      Jones Lang LaSalle brings on head of diversity and inclusion
      EQT inks deal to buy real estate manager
      Chiang Ling Ng
      Hines hires first head of Asia-Pacific real estate investments
      Brand new apartment building on sunny day in spring with blooming trees
      Real estate returns forecast to trend lower – report
    • Retirement cartoon
      Hopes rising for retirement readiness in 2021
      Neal and Brady
      Retirement security could be only issue both sides accept
      Shawn O'Brien
      Annuities coming to target-date funds, but not right away
      David Ireland
      Sponsors returning to questions about in-plan annuities
    • Retirement in emerging markets
      Outlook 2021
      The top 10 stories of 2020
      The best places to work in money management
    • U.S. still a key market for investors
      Collected coverage of P&I's 2020 WorldPensionSummit
      Pedestrians pass a large advertisement on the Arndale Center shopping mall reading 'Act now to avoid a local lockdown' in Manchester, England
      COVID-19 puts new opportunities and risks on the agenda - WPS panelists
      Screens display stock price information over the trading floor of the NYSE Euronext exchange in Paris
      Private assets will continue to grow in portfolios – WPS panelists
  • Data
    • Research Center
    • Searches & Hires Database
    • Searches & Hires News
    • RFPs
    • Charts / Infographics
    • Sponsored Research
    • Trackers
    • Q2 2020 searches and hires overview report
      Q2 2020 money manager M&A activity summary
      Q2 2020 legal overview report
      Q1 2020 searches and hires overview report
    • San Luis Obispo County hunting for private markets consulant
      Texas County commits $45 million to opportunistic real estate
      SEI picks Delaware Investments as equity fund subadviser
      Trenton, Mich., swings to Fidelity to run $20 million in large-cap equities
    • San Luis Obispo County hunting for private markets consulant
      Texas County commits $45 million to opportunistic real estate
      SEI picks Delaware Investments as equity fund subadviser
      Trenton, Mich., swings to Fidelity to run $20 million in large-cap equities
    • Co-Administration, Financial Advisory, Transfer Agent, and Custodial Services
      Maryland State Retirement and Pension System
      Master Custodian and Related Services
      Transition Management Services
    • Taiwan Semiconductor’s No. 1 in the emerging markets book
      U.S. fixed-income returns post another positive year
      Nasdaq delivers an impressive year
      U.S. dollar's recent decline continues
    • Institutional Investors: Shared Expectations, Divergent Paths
      Global Investor Study 2016
      Workplace Financial Wellness
    • U.S. Endowment Returns Tracker
      Pension Fund Returns Tracker
      Earnings Tracker
      Corporate Pension Contribution Tracker
  • Insights
    • Opinion
    • White Papers
    • Industry Voices
    • Letters to the Editor
    • Partner Content
    • Publisher's Update
    • Infrastructure cartoon
      You must go big on infrastructure, Mr. President
      Retirement cartoon
      Hopes rising for retirement readiness in 2021
      view gallery
      25 photos
      Cartoons depict a year like no other
      view gallery
      25 photos
      2020 in editorial Cartoons
    • GP-LED OPPORTUNITIES AT THE SMALLER END OF THE MARKET
      Gold Outlook 2021
      Bond ETFs show maturity during Covid market mayhem
      2021 Outlook: A rousing recovery
    • Fred DeSerio
      Commentary: A new era for manager due diligence
      Charles E.F. MIllard
      Commentary: It’s time to make 401(k) plans into real pension plans
      Michael McNally
      Commentary: New ‘investment-plus’ test poses risks to private equity investors
      Adam Waterous
      Commentary: Institutions urged to act now on opportunities created by current global oil disruption
    • Writer using a typewriter
      OCIO industry needs to adopt GIPS
      Writer or journalist workplace. stock illustration
      Even as it assails China, Trump administration emulates it
      Skeptical of Main Street support for proxy adviser proposal
      Focus on manager diversity pushes asset owners’ to walk the talk
    • Sponsored Content By MassMutual
      Leveraging Data to Manage Risk
      Sponsored Content By iShares
      ETFs are becoming a cornerstone of insurance equity portfolios
      Sponsored Content By Aberdeen Standard Investments
      Taking a passive approach to the hedge-fund universe
      Sponsored Content By World Gold Council
      Gold: the most effective commodity investment
    • Help us help you by supporting quality journalism
      You Must Believe in Spring
      Everything Must Change
      Tomatoes & Investments
  • Multimedia
    • Videos
    • Webinars
    • Polls
    • Slideshows
    • Charts / Infographics
    • watch video
      1:33
      A look at hiring activity in 2020
      watch video
      1:24
      U.S. stocks were 2020’s comeback kid
      watch video
      1:23
      Outlook 2021
      watch video
      1:52
      Buy gold's pullback?
    • Getting Back to Normal: How to Creatively Manage Fixed Income Portfolios in a Rising Rate Environment
      Lessons From 2020: OCIO Model Passes Major Test of Governance
      The Institutionalization of Retail Part 3: Building a Successful Distribution Effort
      What might a Biden DOL and SEC mean for retirement plans?
    • POLL: The Biden administration’s economic plans
      POLL: Retirement issues in 2021
      POLL: Money managers' priority in Asia-Pacific region
      POLL: Retirement issues in the presidential election
    • view gallery
      9 photos
      Coronavirus and the markets
      view gallery
      22 photos
      The 1,000 largest retirement funds: 2020
      view gallery
      10 photos
      Outlook 2020
      view gallery
      10 photos
      2019 as seen through the eyes of Roger
    • By the Numbers for January 2021
      Graphic: A look at hiring activity in 2020
      Riskwatch for Q4 2020
      Taiwan Semiconductor’s No. 1 in the emerging markets book
  • Events
    • Conferences
    • Webinars
    • Defined Contribution Spring Virtual Series
      DC Investment Lineup Virtual Series
      ESG Investing Virtual Series
      Private Markets Virtual Series
    • Getting Back to Normal: How to Creatively Manage Fixed Income Portfolios in a Rising Rate Environment
      Lessons From 2020: OCIO Model Passes Major Test of Governance
      The Institutionalization of Retail Part 3: Building a Successful Distribution Effort
      What might a Biden DOL and SEC mean for retirement plans?
  • Careers
  • Research Center
MENU
Breadcrumb
  1. Home
  2. MONEY MANAGEMENT
January 27, 2017 12:00 AM

Scaramucci scores millions from a buyer with mystery investors

Bloomberg
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print
    Bloomberg
    Anthony Scaramucci

    A few days after Anthony Scaramucci lined up a top job in Donald Trump's White House, he struck a multimillion-dollar deal to exit his investment firm, selling part of his interest to a little-known company, RON Transatlantic EG.

    Mr. Scaramucci, the organizer of a popular hedge fund conference, said Friday in an interview that he doesn't know the identity of RON's investors and relied, as is customary, on RON's managers to vet them. A RON spokesman declined to name the investors, and their identities haven't been disclosed to Mr. Scaramucci's SkyBridge Capital, according to a representative of the firm.

    Mr. Scaramucci is getting a head-turning price compared with similar transactions, analysts say. RON teamed up with another buyer, a subsidiary of Chinese conglomerate HNA Group Co., to buy most of SkyBridge in a deal that values the asset manager at $180 million or more depending on performance, according to people with knowledge of the matter who asked not to be identified because they weren't authorized to discuss terms. Mr. Scaramucci said the price is fair and that he turned down higher offers.

    Securities disclosures and corporate reports identify the man behind at least some of RON's holdings: Danilo Diazgranados Manglano, a 52-year-old Venezuelan-born banker known for close ties to the administration of that country's late president, Hugo Chavez. As of last year, Mr. Diazgranados owned as much as 10% of SkyBridge through a RON investment vehicle formed in the English Channel island of Jersey, one securities filing shows.

    Mr. Diazgranados isn't part of the current buyer group and already has shed his stake in SkyBridge, his lawyer, Gregory Craig, said in an interview. He declined to comment further on the transaction.

    Ethics disclosures

    Richard Painter, who served as an ethics lawyer under former President George W. Bush, said a transaction like the one Mr. Scaramucci is pursuing calls for more public disclosure and a close look by the White House.

    “Here, we've got foreign money, and we don't even know who it is,” said Mr. Painter, now a professor at the University of Minnesota.

    Mr. Scaramucci has filed all of the ethics disclosures required for his White House role and has agreed to recuse himself from any matter that pertains to his SkyBridge interest, said Elliot Berke, a lawyer for Mr. Scaramucci.

    “They bought SkyBridge in spite of, not because of, my affiliation with the administration, because they both recognize that I would personally recuse myself from any and all activities in terms of my relationship with the administration,” Mr. Scaramucci said.

    A spokesman for HNA declined to comment.

    'The Mooch'

    A gregarious Long Island native widely known as “The Mooch,” Mr. Scaramucci was a prominent Trump fundraiser during last year's presidential campaign and a frequent presence at Trump Tower during the transition period.

    On Jan. 12, Bloomberg reported that he was given a top White House role as an assistant to Trump. Mr. Scaramucci, who later said his title is director in the office of public liaison, has already started work at the White House, although he doesn't formally join the staff until Feb. 6, according to a person with knowledge of the matter.

    As news of his appointment broke, Mr. Scaramucci was wrapping up negotiations for the sale of his approximately 45 percent stake in New York-based SkyBridge, which he founded in 2005. The business manages funds of funds, gathering money from clients and entrusting it to outside hedge funds. On Jan. 17, SkyBridge announced the agreement to sell a majority stake to HNA and RON without disclosing terms. The sale includes all of Mr. Scaramucci's interest.

    HNA, based in Haikou City, China, is slated to get a majority stake in the company, according to people with knowledge of the transaction. These people said RON's share is at least 20 percent, and that remaining SkyBridge executives would own the balance. Mr. Scaramucci has already relinquished his role at the company.

    'Rich valuation'

    The valuation of SkyBridge could climb to as much as $230 million if certain performance targets are met, said the people with knowledge of the matter. The basis for Mr. Scaramucci's payout is fixed at the $180 million valuation, they said. The deal is scheduled to close in about three months, the people said.

    The transaction values SkyBridge at 7.2 times normalized Ebitda, or earnings before interest, taxes, depreciation and amortization, Mr. Scaramucci said.

    “That's a rich valuation for a fund-of-funds transaction,” said Karl D'Cunha, managing director at CBIZ Valuation Group in Chicago, who said buyers typically pay three to five times earnings.

    Six other investment bankers, consultants and managers of similar funds also said the valuation was high for a fund-of-funds manager, particularly one that's seen client withdrawals. SkyBridge's assets have fallen after two years of performance that lagged behind peers. The firm had $13.6 billion under management and advisement in July 2015. As of Nov. 30, 2016, the amount had dropped to $12 billion.

    Competitive auction

    Mr. Scaramucci said he held a competitive auction and chose a lower bid from HNA and RON because they offered to protect his partners, employees and investors.

    Mr. Scaramucci said the company has a uniquely valuable feature: a distribution system that taps 41,000 mostly “mass affluent” clients and gives them access to hedge fund investments that would otherwise be out of reach.

    “Every dentist in America can have a $25,000 to $50,000 hedge fund portfolio, run by the best and brightest hedge fund managers in the world — hedge funds that typically have $15 to $25 million minimums,” he said in a Jan. 12 interview in Trump Tower.

    Last year, RON said on its website that it was based in Washington, had offices in Madrid, Mexico City and New York and managed more than $8 billion in investments in energy, telecommunications and finance. That information is no longer on the website.

    The top executive there, Lorenzo Roccia, was born in New York and grew up in Venezuela before returning to the U.S., according to a 2008 profile in a Venezuelan media outlet. He has helped raise funds for several Democratic presidential campaigns, the profile said. Reginald Love, a personal aide — or “body man” — to former President Barack Obama, is a partner in RON's Washington office, according to his LinkedIn account.

    “I've known the principal, Lorenzo Roccia, for 20 years,” Mr. Scaramucci said. “I hold him in the highest regard. He is a man of impeccable character and he has an impeccable reputation.”

    Roccia said in a telephone interview that the investors in the SkyBridge deal are family offices and institutions, but he declined to name them.

    Diazgranados vehicle

    Documents filed in New Jersey last year show that the RON entity that held the SkyBridge stake, known as RON Transatlantic Offshore Ltd., was 85 percent owned by a British Virgin Islands company that was in turn controlled by Mr. Diazgranados. Another Jersey company, RON Transatlantic Brewery Services Ltd., was 82 percent owned by the Diazgranados vehicle. And two other RON companies filed disclosures in Washington identifying their directors as Messrs. Diazgranados and Roccia and Abel Navarro Homet, who lists a Madrid address.

    Mr. Diazgranados's son, Francisco, works at SkyBridge as an associate, according to a document filed with the Financial Industry Regulatory Authority.

    Mr. Diazgranados was once a prominent broker in Venezuela with a reputation for close ties to the Chavez government and for advising it on financial transactions.

    In a confidential 2006 State Department cable, a top U.S. diplomat in Venezuela, Kevin Whitaker, described Mr. Diazgranados as “the intermediary” between the Chavez government and financial institutions for handling “off-the-books activities.” The cable was later made public by WikiLeaks. The State Department declined to comment, as did Mr. Diazgranados's lawyer.

    “He presents himself to the private sector as the man with the contacts needed inside the government to make financial deals happen,” said Francisco Faraco, who has worked as a financial analyst in Caracas for decades.

    Trash hauling

    At one point under Mr. Chavez's reign, Mr. Diazgranados's holdings included $300 million in assets, including a trash-hauling company with government contracts, a diamond mine, two insurance companies and stakes in newspapers, according to the resume of a former employee of Mr. Diazgranados's posted online.

    Mr. Chavez, who served as president from 1999 until his death in 2013, was succeeded by his vice president, Nicolas Maduro.

    Mr. Diazgranados left the country in 2008 because of the deteriorating security situation there, he told the newspaper El Mundo in 2010. In the interview, El Mundo asked Mr. Diazgranados to answer critics who labeled him a “boliburgues” — a member of a group of insiders who prospered under the Chavez regime by profiting from government connections. He dismissed it as mere guilt by association.

    “Every person who has made money in the last 10 years is either Chavista or a thief,” he said. “That is the mentality in Venezuela.”

    Mr. Diazgranados wrote in an email Friday that he has hasn't been to Venezuela since 2008.

    “I have no business or financial or political or personal relationships with the Maduro government,” he said.

    Related Articles
    Trump expands economic policy adviser team
    Trump adviser Anthony Scaramucci promises to 'repeal' DOL fiduciary rule
    Donald Trump taps SkyBridge, Goldman execs for White House roles
    SkyBridge Capital sells majority stake to HNA Capital (U.S.), RON Transatlantic
    Scaramucci clarifies that his SkyBridge is 'almost' sold
    Anthony Scaramucci adviser role said to be revisited by White House
    Trump passes over Anthony Scaramucci for public liaison
    Trump said to pick Scaramucci to be ambassador to OECD
    Hedge fund founder takes new role at White House
    Recommended for You
    River and Mercantile chooses head of infrastructure
    Black hangs on at Apollo as Epstein links cost him CEO role
    Black hangs on at Apollo as Epstein links cost him CEO role
    NN Investment Partners adds head of sustainable and impact equity team
    NN Investment Partners adds head of sustainable and impact equity team
    Research for Institutional Money Management
    Sponsored Content: Research for Institutional Money Management
    sponsored
    Events
     
     
    Sponsored
    White Papers
    GP-LED OPPORTUNITIES AT THE SMALLER END OF THE MARKET
    Gold Outlook 2021
    Bond ETFs show maturity during Covid market mayhem
    Global gold-backed ETFs: A popular gateway to the gold market
    2021 Outlook: A rousing recovery
    Climate change and emerging markets after Covid-19
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    pilogo-NEW
    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    150 N. Michigan Ave.
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Content Solutions
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • NEWS
      • Asset owners and the coronavirus
      • Alternatives
      • Consultants
      • Coronavirus
      • Defined Contribution
      • ESG
      • Frontlines
      • Hedge Funds
      • Investing / Portfolio Strategies
      • Money Management
      • Pension Funds
      • People Moves
      • Private Equity
      • Real Estate
      • Searches & Hires News
      • SECURE Act
      • Special Reports
      • WorldPensionSummit
    • Data
      • Research Center
      • Searches & Hires Database
      • Searches & Hires News
      • RFPs
      • Charts / Infographics
      • Sponsored Research
      • Trackers
    • Insights
      • Opinion
      • White Papers
      • Industry Voices
      • Letters to the Editor
      • Partner Content
      • Publisher's Update
    • Multimedia
      • Videos
      • Webinars
      • Polls
      • Slideshows
      • Charts / Infographics
    • Events
      • Conferences
      • Webinars
    • Careers
    • Research Center