Blackstone plans major hedge fund move

Blackstone Group, the New York-based alternative asset manager currently raising a $13bn private equity fund, is planning to muster as much as $10bn for hedge fund investment.

Tony James, president, Blackstone Group

In an interview with the Financial Times, Blackstone Group president Tony James said the firm planned to launch a “flagship fund” that would form the core of its hedge fund push, which would probably have either a long/short equity or multi-strategy approach.

James said the strategy would take time and would depend on hiring the right people, but it was possible for the firm to eventually have between $5 billion (€4.3 billion) and $10 billion dedicated to hedge funds.

Earlier this year, John Dionne joined Blackstone from Bennett Restructuring Funds, a $1 billion hedge fund, to run the firm’s new $500 million distressed debt fund.

The reach of Blackstone is expanding far and fast. The firm is expected to announce soon the final closing of its latest private equity fund at around $13 billion. In addition, its next real estate fund is predicted to collect between $5 billion and $6 billion, while a move into mutual funds is also reported to be a target for the group.