DB Capital Partners FoFs to merge with DeAM

The fund of funds division of Deutsche Bank has been merged into Deutsche Asset Management to provide the bank’s private banking clients with access to its private equity products.

(PrivateEquityCentral.net) Deutsche Bank’s fund-of-funds business has joined Deutsche Asset Management in a move designed to give Deutsche Bank’s private banking clients access to its private equity products.


The fund-of-funds business used to be part of DB Capital Partners, whose management team completed a E1.5bn buyout of late stage investments from Deutsche Bank in February.


The New York-based group, led by Chuck Flynn, has 15 professionals and will report to William Shiebler, the chief executive officer of Deutsche Asset Management, Americas. The group has committed to more than 300 funds, with $4bn committed to those funds. The management and administration of Deutsche Bank’s existing portfolio of private equity funds will remain under separate management in the Corporate Investment division.


The fund-of-funds business will take its third party money Deutsche Asset Management, with more than half of its portfolio moving as well, according to Graeme Johnson, a managing director and head of Europe at the newly created Deutsche Asset Management Private Equity.


“Deutsche Asset Management is one of the world's largest asset managers, but they haven't had a third party private equity product,” Johnson said. “That's one of the things high-net-worth and institutional clients want.”


Other alternative investment divisions under the Deutsche Asset Management umbrella include DB Absolute Return Strategies and DB Real Estate.


“With the addition of the Private Equity Fund of Funds Group we have further strengthened our position as a leading provider of alternative offerings to our clients globally,” Tom Hughes, global head of Deutsche Asset Management, said in the statement.


“Joining Deutsche Asset Management provides our team with access to the breadth and depth of DeAM’s global platform,” Flynn said in the statement. “We look forward to becoming part of an asset manager in Deutsche Asset Management that provides clients a complete suite of traditional and non-traditional product offerings.”


Charles Van Horne, managing director at fund-of-funds firm Abbott Capital Management, said this was part of Deutsche Bank cleaning up its organisation. Van Horne has worked with Flynn and Johnson in the past, when they were with AXA's third party fund-of-funds group and he was with AIG.


“My heart goes out to the guys embedded in large financial groups because they have so many internal alligators biting at them,” Van Horne said. “Being in a part of the organisation that helps them, that's all the better.”