Insight 3D Financial Trends

Sun 30 June 2019


Posted by Bill Johnson in Hedge Funds   

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Investcorp is a global manager of alternative investment products, for private and institutional clients. Founded in 1982, the firm has offices in New York, London, Bahrain, Abu Dhabi, Riyadh, Doha, Mumbai and Singapore. Investcorp's principal client base is in the six countries of the Gulf Co-operation Council, but it also has institutional clients in North America, Europe and Asia. The company's main activities involve corporate investment, real estate and credit management, and has \$34.2 billion worth of assets under management, as of 2019. It typically places the private equity of companies and real estate properties it acquires directly with investors on a deal-by-deal basis and through a fund structure. In addition, the firm operates the Gulf Opportunity Fund investing in the MENA region, and a number of technology funds.Investcorp currently has approximately \$22.2 billion in invested assets under management across its four asset classes. In 2011, it ranked 67th in the PEI300 (Private Equity Index 300) ranking of private equity firms by assets deployed, with \$4.68bn invested in private equity over the previous five years.The company is regulated in Bahrain as a wholesale bank, and has traditionally utilised long-term and medium-term bank financing, including private placements and syndicated loans, in order to ensure a longer maturity profile. The company's capital adequacy ratio (Basel III) at 2017 December 30 was 29.8%. The company is listed on the Bahrain Bourse (BSE), with a financial year end of 30 June.


The company was founded in 1982 by Nemir Kirdar, and acquired Tiffany & Co in 1984, floating in 1987. The company diversified in 1997 into hedge funds. Kirdar stepped down as CEO and executive chairman in 2015. Investcorp made several acquisitions between 2016 and 2019, pushing into China with investments into tech and the food sector. In 2019, the company also pushed into the US market with the acquisition of Mercury Capital.Investcorp's portfolio company, Moneybookers, ended its relationship with WikiLeaks in August 2010 as a result of U.S. government pressure.

Investment areas

Corporate investment

Corporate investment is Investcorp's traditional activity. This includes mid-size companies in North America, Western Europe and MENA including Turkey, as well as technology lower mid-cap investment, through Investcorp Technology Partners.The past and present portfolio includes over 175 investments. Selected past investments include:

Tiffany & Co. – retailers of jewelry and luxury goods – acquired 1984, floated 1987 Gucci – designer, producer and distributor of luxury accessories and apparel – acquired from 1989 to 1993, floated 1996 Leica Geosystems – measuring instrument manufacturer acquired 1998, floated 2000 Jostens – US provider of school-related affinity products – acquired 2000, sold 2003 Neptune Technology Group – US manufacturer of water meters – acquired 2001, sold 2003 MW Manufacturers – a US maker of windows and patio doors – acquired 2002, sold 2004 Hilding Anders – European mattress and bed manufacturer – acquired 2003, sold 2006 Apcoa – European parking management providers – acquired 2004, sold 2007 American Tire Distributors – the largest US independent tire distributor – acquired in 2005, sold in 2010 Moody International – international provider of quality and safety services – acquired 2007, sold 2011 FleetPride – North America's largest distributor of truck and trailer parts – acquired 2006, sold 2012 ProUnlimited – United States-based software and services firm – acquired in 2014 jointly by InvestCorp & Bahrain Mumtalakat Holding Company.

Real estate investment

The real estate division based in New York and London, sources and performs due diligence, and arranges financing and the acquisition of US and EU properties and US commercial mortgage debt positions. The investment in these properties or loans is typically aggregated into a series of multi-investment portfolios for placement to clients. Debt investments are also made within a series of debt funds which are managed by the group. Since 1995, Investcorp has acquired in the region of 470 properties, totaling approximately \$14 billion in value. It currently has more than \$5 billion of property under management.

Hedge funds

Investcorp's hedge fund business was established in 1996 and today has approximately \$3.5 billion of capital under management, of which approximately \$0.2 billion is reserved for proprietary investments. The fund of funds program comprises a selection of funds of hedge funds with varying risk/return profiles. These are invested across different strategies through approximately 45 hedge fund managers.In addition Investcorp has developed a single manager seeding platform, and currently offers, on a joint venture basis, access to six managers with specific strategies. The single manager platform currently has around \$1.8 billion in client and proprietary assets under management. In the last few years customised portfolios have grown as a proportion of the firm's overall hedge fund assets under management, with traditional fund-of-funds reducing.(subscription required) 16% of the hedge fund business is invested through fund of funds. The remainder is invested through customized investments, seeding businesses and a single manager platform. The hedge fund business also provides institutional investors with access to its emerging manager program, investing with and seeding early stage managers who, according to Investcorp research, outperform larger hedge funds on a risk adjusted basis.

Credit management

Investcorp Credit Management has assets under management of over \$11 billion. Based in London, New York and Singapore, they manage funds which invest primarily in senior secured corporate debt issued by mid and large-cap corporates in Western Europe and the US.