Crestline Investors and J.P. Morgan Chase's investment bank have teamed up to help institutional investors get out of illiquid hedge funds.
J.P. Morgan will assist Crestline in identifying investors that want to offload hedge fund stakes, according to a news release from the bank. J.P. Morgan investment bankers estimated European investors alone still have between $50 billion and $60 billion in illiquid hedge funds from which they can't get redemptions.
Crestline is best known for its hedge funds-of-funds business but also maintains a hedge fund secondary market investment platform where investors can sell their shares.
In addition to facilitating hedge fund stake sales, Crestline also has created three funds that invest in secondary market hedge fund shares. Since 2009, Crestline has attracted a total of $1.2 billion of investments or commitments mostly from institutional investors for these dedicated funds, according to the release.
“The (secondary hedge fund) market is typified by just a small number of specialist fund managers, such as Crestline, who are increasingly securing investment from institutional clients who have significant amounts of capital to deploy in this sectors,” said Thomas Doyle, managing director and head of fund-linked product structuring in J.P. Morgan's investment banking unit in London, in the release.
Crestline managed a total of $6.3 billion of assets as of April 1, according to its SEC ADV filing.