Grosvenor buys Credit Suisse’s PE fund of funds

The hedge fund manager is expected to pay more than $200m for the bank’s $18bn Customized Fund Investment Group, which will create an entity with around $40bn under management.

Grosvenor Capital Management has acquired Credit Suisse’s Customized Fund Investment Group, its private equity fund-of-funds business. 

The division, which will be renamed GCM Customized Fund Investment Group upon completion of the transaction, has $18 billion under management and operates in 11 offices around the world. The combined firm will manage around $40 billion and counts 400 employees. 

The transaction marks the first foray into the private equity industry by Grosvenor, a Chicago-headquartered fund of hedge funds. The firm had been in talks to acquire the unit since last spring, as Private Equity International previously reported

CFIG will become a subsidiary of Grosvenor and continue to operate from its New York headquarters, Grosvenor said in a statement. It will also retain all of its senior management team, the members of which have signed long-term agreements to remain with the combined firm. 

No financial details were disclosed for the transaction, but the Wall Street Journal earlier reported that the business was valued at more than $200 million. 

Credit Suisse last year announced its intention to sell CFIG and its $9 billion private equity secondaries group, Strategic Partners, to comply with new regulation and build a more liquid alternative business. The Blackstone Group acquired Strategic Partners earlier this year. 

Founded in 1971, Grosvenor employs more than 200 people in Chicago, London and Tokyo. It is partly owned by Hellman & Friedman, a US buyout firm, which acquired a minority stake in the business in 2007. It currently has around $20 billion under management.