Man Launches New US Tax Exempt Hedge Fund Product

by Phillip Morton, Investors Offshore.com

06 April 2004

Man Group, the world’s largest listed hedge fund manager, last Friday announced the launch of a new fund of hedge funds designed specifically for tax-exempt US investors.

The fund, the latest in a series of registered products that the firm is launching in the US, will provide qualified investors access to the portfolio of an already established multi-strategy fund-of-hedge funds which has a ten year track record.

Man Investments Inc., a US subsidiary of Man Group plc, is the fund's primary distributor and will distribute through a nationwide channel of intermediaries.

"We expect that Man-Glenwood Lexington TEI, LLC will satisfy the high demand for fund-of-hedge funds among tax-deferred and tax-exempt investors,” commented Stanley Fink, Chief Executive of Man Group plc.

According to Fink, the fund has attracted “significant interest” from tax exempt US investors. “Thus, we felt Man-Glenwood Lexington TEI, LLC would offer qualified tax-deferred and tax-exempt investors a product designed to address their specific tax requirements," he added.

The structure of the fund allows eligible investors with tax-advantaged status - pension plans, employee benefit plans, foundations and endowments, and individual retirement accounts (IRAs) - to invest with a minimum of $25,000. This is Man Group plc’s first registered fund designed to eliminate unrelated business taxable income (UBTI) which is otherwise taxable to tax-advantaged investors.

The fund is a closed-end investment company that uses a fund-of-hedge-funds strategy designed to preserve capital and generate attractive returns that have low correlation with traditional stock and bond markets.

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