Article First Ran June 14, 2010 Want to move to Amsterdam? IMQubator, a Dutch based hedgefund incubation firm is seeding fund managers. However, they request your presence in the Netherlands .

Cavenagh Hedge Fund Gets Dutch Pension Money, Moves to Europe

June 14 (Bloomberg) — Cavenagh Capital, set up last year by former Morgan Stanley and DBS Holdings Ltd. managers in Singapore, will start a new macro hedge fund in July after getting money from the biggest Dutch pension fund.

Want to move to Amsterdam? IMQubator, a Dutch based hedgefund incubation firm is seeding fund managers. However, they request your presence in the Netherlands.

Cavenagh Hedge Fund Gets Dutch Pension Money, Moves to Europe

June 14 (Bloomberg) — Cavenagh Capital, set up last year by former Morgan Stanley and DBS Holdings Ltd. managers in Singapore, will start a new macro hedge fund in July after getting money from the biggest Dutch pension fund.

Andrew Gale and Lee Ka Shao moved to Amsterdam this month after getting a three-year seeding commitment from APG, which manages the assets of Heerlen, Netherlands-based Stichting Pensioenfonds ABP. said Gale.

Asian hedge-fund managers, especially startups and those overseeing smaller amounts, have been finding it tough to raise money as investors remain wary after the financial crisis. About 70 percent of the funds launched in the past two years had $50 million or less as of the end of March, according to Singapore- based GFIA Pte, which advises investors seeking to allocate money to hedge funds.

Seeding Capital

APG’s investment in Cavenagh was made through IMQubator, which provides seeding capital to new managers.

Cavenagh “is a rare combination of highly original thinking, very methodical risk reward analysis with a strong instinct to find cheap option prices,” said Rikard Lundgren, chief investment officer of Amsterdam-based IMQubator. “The Asian macro space is well matched with the manager’s skill and method and he has an excellent track to prove it too.”

IMQubator requires the managers it invests in to be in the same office “as part of the close monitoring and transparency that we require,” Lundgren said. IMQubator has made five allocations of 25 million euros each to new managers and may make as many as four more commitments before the end of the year, he said.

As managing director of DBS’s Central Treasury Unit until 2007, Lee, 40, set up and ran the bank’s principal strategies business and produced returns that averaged 38 percent a year, Gale said. Lee grew the unit’s capital to almost $1 billion, from the $125 million that the Singapore-based bank, Southeast Asia’s biggest, had given him initially, Gale said.

The fund will target returns of 15 percent to 20 percent, said Gale, who was most recently responsible for product development and asset raising at London -based Dexion Capital Plc.

To contact the reporter on this story: Netty Ismail in Singapore nismail3 .