The closed-end fund Gartmore has agreed to pick up is the $23 million Montgomery Partners Absolute Return Fund, which invests in a variety of hedge funds that pursue diverse investment strategies, according Dow Jones, citing sources close to the situation. The fund was one of several excluded from Wells Fargo & Co.’s agreement to acquire Montgomery Asset Management from Germany’s Commerzbank AG in November.
Gartmore also brought on the former head of Montgomery’s alternative-investments division. William Santos, who used to head Montgomery Partners, the San Francisco money manager’s alternative-investments division, confirmed to Dow Jones that he had joined Gartmore, but wouldn’t comment further.
In addition, a recent filing with the US Securities and Exchange Commission (SEC) suggests Gartmore, the global asset-management arm of Nationwide Mutual Insurance Co., may be trying to snap up three more Montgomery funds, according to the report.
Gartmore Tapped as Interim Advisor
In an SEC filing, the board of trustees of Montgomery Funds said it had appointed Gartmore Global Asset Management Trust as the interim investment adviser to the $24-million Montgomery Global Opportunities Fund and the $28 million Montgomery Global Focus Fund. The board also appointed Gartmore Mutual Fund Capital Trust, another member of the Gartmore Group, as the interim investment adviser to a third fund, the $58-million Montgomery Global Long-Short Fund, the filing said.
Shareholders will receive a proxy within the next few months asking for their approval of new investment advisory arrangements and the reorganization of the three funds into corresponding Gartmore-managed funds.
Both the Montgomery Partners Absolute Return Fund and the Montgomery Global Long-Short Fund were part of Montgomery’s strategy of making hedge funds available to smaller investors. The Montgomery Partners Absolute Return Fund is only available to investors with a net worth of $1 million, but has an investment minimum of $25,000. By comparison, many unregulated hedge funds have minimums of $1 million or more.