Henderson Global Investors is set to launch a European opportunity fund to acquire asset-backed securities. The team aims to raise over EUR 250 mln this year with the first closing scheduled for 1 July 2009.
Henderson Global Investors is set to launch a European opportunity fund to acquire asset-backed securities. The team aims to raise over EUR 250 mln this year with the first closing scheduled for 1 July 2009.
The fund is aimed at institutional investors and will seek to capture the recovery in value of a portfolio of highly-rated tranches of ABS with a predominantly European focus.
Henderson said the fund will target securities that remain fundamentally robust, but trade at material discounts to par due to the illiquidity premium available under current market conditions. It is anticipated that at least 75% of the portfolio will be invested in residential or commercial mortgage backed securities and that at least 75% in the most senior tranches of securitisation structures.
Managed by Jim Irvine, head of structured products and Colin Fleury and Ed Panek, Asset Backed Securities portfolio managers, the fund has a five-year life and a target return in the region of 4-5% over Euribor per annum, gross of fees over the fund's life.
Jim Irvine, head of structured products said: 'We have already received positive response to the fund launch in early discussions with consultants and clients. There are two broad reasons for launching this fund right now. Firstly, there are swathes of ABS trading at discounts due to general market illiquidity as opposed to being fundamentally impaired or distressed. Secondly, Henderson’s experience in structured products, real estate and credit gives us the capability to analyse and identify the right securities to build a robust portfolio.'
