THE BUY SIDE - CQS Gets Energized

BUYING AN INVESTMENT BOUtique that focuses on energy and natural resources might sound like a strange pursuit for a hedge fund executive who specializes in convertible arbitrage and credit strategies. But Michael Hintze, 54, the founder, CEO and senior investment officer of London-based CQS, is keen to diversify his $8.7 billion business -- and his investor base. Since last December, when CQS launched its first publicly traded, long-only investment vehicle, the CQS Rig Finance Fund, on the London Stock Exchange's Alternative Investment Market, Hintze has been looking to add talent to CQS's energy team and to broaden its closed-end fund offerings.

This summer, in a chance encounter with his friend and fellow investment manager Richard Lockwood at a fundraising event for London's Trinity Hospice, Hintze had an inspiration. Although Lockwood, 64, wasn't necessarily looking to sell New City Investment Managers, the energy and natural-resources investing boutique he founded nearly four years ago, Hintze realized they shared a common ambition: To diversify and broaden their businesses through strategic development of new, highly specialized energy and natural-resources funds -- specifically closed-end funds, which aren't subject to the same potential redemption pressures as traditional long-short hedge fund structures. Lockwood agreed.

“这只是一个经典的时刻，”Hintze说。“我告诉理查德，我多年来知道的，我们为我们的业务建立了一个伟大的运营平台，但我们仍在寻找有才华的人来帮助我们扩大我们的投资活动。理查德说 - 把它说其他方式 - 他有伟大的人和愿望扩大，但他需要一个更强大的运营平台和后台。“

该交易于9月下旬宣布，收到了Swift监管批准，并于本月早些时候完成。虽然HINTZE讨论了这些条款，但合并的公司将拥有200多名员工，并在一系列信用卡，可兑换，资产支持甚至股权战略中投入的管理资产超过93亿美元。Hintze愿望扩展到邻近的，密切相关的投资策略并非没有先例：一些最大，最信誉良好的多际经理，如芝加哥的城堡投资集团和纽约大桥资本管理，开始于可转换套利。

As that once-arcane strategy has become increasingly commoditized, its practitioners have searched for new ideas, in part to shockproof their businesses. Investors, who are quick to reallocate their funds during times of economic stress, have punished convertible arbitrage managers during market dislocations. After managers got caught in spring 2005 by the downgrade of General Motors Corp.'s debt to junk status, the total invested in convertible arbitrage globally plunged from $48.5 billion in the second quarter of 2004 to $36.7 billion in the fourth quarter of 2005, according to Chicago-based Hedge Fund Research. The sector subsequently recovered. It is up by 17.6 percent in 2007, to $53.13 billion, according to HFR; however, no one quite knows how the summer's U.S. subprime contagion will affect investor sentiment.

CQS从美国出来的次级危机中令人沮丧。其旗舰敞篷和量化战略基金（该公司被命名为8月份），八月下降1.5％，在9月份的2.0％上涨了2.0％的费用;到目前为止，这是8.23岁。但是，在过去几年中一直在悄悄地改变CQS的Hinze仍然对外部业务风险敏感。

He has sought to complement the firm's two core portfolios -- the CQS fund and the CQS Capital Structure Arbitrage Fund, launched in 2002. Since 2005, Hintze and his senior portfolio managers have added an asset-backed securities fund -- up 11.82 percent net through August -- an aggressive directional opportunities fund in convertible arbitrage and credit, two collateralized loan obligation funds, an Asia-based convertible arbitrage and quantitatively driven market-neutral long-short equity fund and the CQS Rig Finance Fund, which helps finance the construction of deep-sea oil rigs by buying the companies' high-yield debt.

由Mark Conway领导的石油钻机融资，CQS的信贷署，也受到新城市洛克伍德的关注，他是在伦敦的股票交易公司Hoare Govette举办的矿业部门的合伙人，在推出自己的业务之前。他和他的共同创始合作伙伴Andrew Ferguson - 一位前采矿工程师 - 在伦敦市赢得了稳固的声誉，为他们的工作设计高度不寻常的能源基金，包括致力于铀和核能的首次基金。自2006年7月至2007年8月的成立以来，在渠道岛屿证券交易所上市的Aptly·莱格特柜台已返回超过87％。

CQS已经有一个能源分析师团队的事实 - 加上一个值得投资银行的后台 - 帮助说服洛克伍德销售是有道理的。“我们擅长设计人们想要投资的产品，但我们已经达到了十字路口，”洛克伍德说。“我们只有七个人员工，而且 - 如果我们扩大 - 我们必须承担我们的后台巨大增加，这不是我们特别想做的。加入CQS将为我们提供人员配置我们需要，但我们团队中没有人会失去他们的身份。“

Ultimately, Hintze says, consolidation is bound to continue, as managers find it harder to break into the ranks of the largest, multibillion-dollar hedge funds, and win all the advantages that size and scale can bring. For those who have the drive but not the back-office staff, help may be only a handshake away.

THE FACTS

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NAME: Michael Hintze

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职位：CQS的首席执行官

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APPOINTMENT: Founded firm in 1999

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WHAT WE KNOW: A pioneer in convertible arbitrage and credit strategies, Hintze is bullish on energy and natural-resources investing.