JPMorgan Buys Rest of Highbridge

JPMorgan Chase, which already owned 77.5% of the hedge fund manager, is expected to complete a deal for the remainder by July 1.
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JPMorgan Chase

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is purchasing the remaining stake it does not own in hedge fund manager Highbridge Capital Management.

JPMorgan Asset Management, which acquired a majority stake in the New York-based hedge fund in December 2004, has been increasing its stake in the firm over the last five years, according to a release from Highbridge.

JPMorgan owned a 77.5% stake in Highbridge at the end of 2008, according to

Bloomberg

.

Terms of the deal were not disclosed. The purchase is expected to be completed deal on July 1.

"Since day one of the partnership between JPMorgan Asset Management and Highbridge, our goal was to create an institutionalized hedge fund business with the ability to deliver strong risk-adjusted returns," JPMorgan Asset Management's CEO Jes Staley said. "Under the leadership of Glenn and Henry, we've not only accomplished this, but have uniquely positioned the JPMorgan/Highbridge partnership to deliver best-in-class investment opportunities to our broad range of clients going forward."

Following the purchase, Highbridge's co-founder Glenn Dubin will continue in his role as CEO of the firm, while co-founder Henry Swieca will leave the firm after a transition period. Swieca will "seek new opportunities in the finance industry," according to the release.

The company, founded in 1992, manages roughly $21 billion for financial institutions, corporate pension funds, university endowments and family offices. It has offices in New York, London, and Hong Kong.

Since JPMorgan's investment in the firm, the hedge fund manager has tripled its assets under management and expanded its business to evolve into a "global diversified investment management platform" that offers products across its hedge fund, traditional investment management and private investment businesses.

It manages a number of investment vehicles, including multistrategy and single strategy funds. The firm also operates Highbridge Principal Strategies, an investment group focused on the mezzanine and credit sectors, Highbridge's Web site says.

In the earlier part of the decade, big banks including

Citigroup

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,

Morgan Stanley

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and failed securities firm Lehman Brothers were eagerly snapping up stakes in hedge funds and other alternative asset management firms.

Highbridge was quick to point out in the release that as the hedge fund industry has declined given the financial crisis of the last two years, the firm is "exceptionally well positioned, given its depth of investment talent and institutional quality operating platform."

Bloomberg

reported last week that JPMorgan Chase plans to shut down the hedge fund business and private-equity division of its principal investment management group. Still the company plans to keep a team that focuses on Asia,

Bloomberg

said, citing two people familiar with the plan.

Shares of JPMorgan Chase were up 60 cents to $35.44 midday Thursday.