American alternative asset manager Carlyle Group has decided to wind down its hedge fund-of-funds unit Diversified Global Asset Management (DGAM).
Toronto-based DGAM, acquired two years ago by Carlyle, manages funds that invest in other hedge funds. As of 30 April 2015, the firm oversaw $2.3bn in managed and $4bn in advised assets.
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Carlyle head of global communications Chris Ullman said in an emailed statement: "Unfortunately, the challenging market environment made it difficult to scale in fund-of-hedge funds and liquid alternatives."
Most of the employees of DGAM will leave Carlyle, Ullman said.
The move comes two months after management changes at Carlyle’s investment solutions unit that includes DGAM. The unit also includes private equity funds-of-funds specialist AlpInvest Partners, and Metropolitan Real Estate Equity Management.
Following the closure of DGAM, the resources of the solutions unit will refocus on AlpInvest and Metropolitan, which will be more rewarding especially in private market secondaries, co-investment and managed account activities, Ullman added.
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