Soros Hands Top Money Man Bessent $2 Billion to Start Firm (1)
2015-08-04 22:25:50.417 GMT
(Updates with new fund strategy in eight paragraph.)
By Katherine Burton
(Bloomberg) -- Scott Bessent, who’s been overseeing George
Soros’s $30 billion fortune for the last four years, will leave
at the end of 2015 to start his own hedge-fund firm.
Bessent, 52, is forming Key Square Group with a $2 billion
investment from Soros, according to a memo sent to employees of
Soros Fund Management. That will make his firm one of the
largest hedge-fund start-ups ever, even before he begins raising
money from other investors.
“Over the past four years, Scott has managed the firm’s
assets with skill and dedication,” said Robert Soros, George’s
son, in the memo. “He has decided to start his own venture
because of the constraints involved in working with a family
office structure, which prevent him from raising outside
capital.”
Bessent has spent much of his career managing money for
Soros, overseeing his European investments for about eight years
in the 1990s, and returning to the firm in late 2011. Since
then, the family office has made about $10 billion in profit
under Bessent as investment chief, or about 13 percent
annualized, according to a person familiar with the firm who
asked not to be named because it’s private.
Bessent will continue to advise the family office and
remains close to Soros and his family, the memo said. After he
leaves, the investment strategy and asset allocation will be
managed by the existing committees that Robert Soros and Bessent
put in place.
Chanos, Druckenmiller
After graduating from Yale University in 1984, Bessent did
stints at Brown Brothers Harriman & Co., Saudi Arabian holding
company Olayan Group and Jim Chanos’s Kynikos Associates before
taking a job as an analyst for Soros’s hedge fund. Soon after,
he became the fund’s London-based portfolio manager, as Soros
fired the European team that had been struggling to make money.
In 2000, Bessent decided to strike out on his own after
Soros announced he was cutting risk and two of his lieutenants,
Stan Druckenmiller and Nick Roditi, left the firm. He raised $1
billion for Bessent Capital Management, which ran a global and a
European stock fund. At the time, about $150 million came from
Soros.
Bessent was in the process of forming a macro fund when he
was recruited by Soros’s family office in September 2011. His
new fund will also try to profit from macroeconomic trends.
Bessent didn’t return a call seeking a comment.
Jack Meyer, the former head of Harvard University’s
endowment, holds the record for the largest hedge-fund startup
when he opened Convexity Capital Management with more than $6
billion in 2006. Druckenmiller’s former colleagues at Duquesne
Capital Management opened their PointState Capital with $5
billion in 2011.
For Related News and Information:
Ex-Soros Trader Bessent Returns to $25 Billion Firm as CIO
Soros Said to Make $1 Billion Since November Betting Against Yen
Janus Says Soros’s Quantum Invests $500 Million With Gross
Bloomberg Active Indexes for Funds: BAIF <GO>
To contact the reporter on this story:
Katherine Burton in New York at +1-212-617-2335 or
kburton@bloomberg.net
To contact the editors responsible for this story:
Christian Baumgaertel at +1-617-210-4624 or
cbaumgaertel@bloomberg.net
Pierre Paulden
2015-08-04 22:25:50.417 GMT
(Updates with new fund strategy in eight paragraph.)
By Katherine Burton
(Bloomberg) -- Scott Bessent, who’s been overseeing George
Soros’s $30 billion fortune for the last four years, will leave
at the end of 2015 to start his own hedge-fund firm.
Bessent, 52, is forming Key Square Group with a $2 billion
investment from Soros, according to a memo sent to employees of
Soros Fund Management. That will make his firm one of the
largest hedge-fund start-ups ever, even before he begins raising
money from other investors.
“Over the past four years, Scott has managed the firm’s
assets with skill and dedication,” said Robert Soros, George’s
son, in the memo. “He has decided to start his own venture
because of the constraints involved in working with a family
office structure, which prevent him from raising outside
capital.”
Bessent has spent much of his career managing money for
Soros, overseeing his European investments for about eight years
in the 1990s, and returning to the firm in late 2011. Since
then, the family office has made about $10 billion in profit
under Bessent as investment chief, or about 13 percent
annualized, according to a person familiar with the firm who
asked not to be named because it’s private.
Bessent will continue to advise the family office and
remains close to Soros and his family, the memo said. After he
leaves, the investment strategy and asset allocation will be
managed by the existing committees that Robert Soros and Bessent
put in place.
Chanos, Druckenmiller
After graduating from Yale University in 1984, Bessent did
stints at Brown Brothers Harriman & Co., Saudi Arabian holding
company Olayan Group and Jim Chanos’s Kynikos Associates before
taking a job as an analyst for Soros’s hedge fund. Soon after,
he became the fund’s London-based portfolio manager, as Soros
fired the European team that had been struggling to make money.
In 2000, Bessent decided to strike out on his own after
Soros announced he was cutting risk and two of his lieutenants,
Stan Druckenmiller and Nick Roditi, left the firm. He raised $1
billion for Bessent Capital Management, which ran a global and a
European stock fund. At the time, about $150 million came from
Soros.
Bessent was in the process of forming a macro fund when he
was recruited by Soros’s family office in September 2011. His
new fund will also try to profit from macroeconomic trends.
Bessent didn’t return a call seeking a comment.
Jack Meyer, the former head of Harvard University’s
endowment, holds the record for the largest hedge-fund startup
when he opened Convexity Capital Management with more than $6
billion in 2006. Druckenmiller’s former colleagues at Duquesne
Capital Management opened their PointState Capital with $5
billion in 2011.
For Related News and Information:
Ex-Soros Trader Bessent Returns to $25 Billion Firm as CIO
Soros Said to Make $1 Billion Since November Betting Against Yen
Janus Says Soros’s Quantum Invests $500 Million With Gross
Bloomberg Active Indexes for Funds: BAIF <GO>
To contact the reporter on this story:
Katherine Burton in New York at +1-212-617-2335 or
kburton@bloomberg.net
To contact the editors responsible for this story:
Christian Baumgaertel at +1-617-210-4624 or
cbaumgaertel@bloomberg.net
Pierre Paulden