Galleon Said to End Operations in Singapore at Year-End

Galleon Said to End Operations in Singapore at Year-End


Dec. 1 (Bloomberg) -- Galleon Group LLC, the U.S. hedge- fund firm that’s liquidating after its founder was charged with insider trading, will stop operating in Singapore on Dec. 31, said two people familiar with the matter.

At least two firms have been in talks to take on Galleon’s teams both in the U.S. and Singapore, one of the people said, asking not to be identified because the information is private. The teams in Singapore, which had assets of about $500 million before Raj Rajaratnam’s Oct. 16 arrest, also have been approached by other firms focusing on the region, another person said, declining to provide details because of non-disclosure agreements between Galleon and potential investors.

Galleon, which managed about $3.7 billion, opened its Asian headquarters in Singapore last year, moving investment professionals from New York and hiring former DBS Group Holdings Ltd. Vice Chairman Frank Wong to help expand in the region. The employees are likely to be sought due to the limited talent pool in Asia’s hedge-fund industry, said Peter Douglas, principal of GFIA Pte, a Singapore-based hedge-fund consulting firm.

“There’s a great deal of startup activity in the Asian hedge-fund industry, and all indications are that substantial global capital is poised to flow back to the sector,” he said. “The big constraint, as always, is the supply of skilled and credible people, so front and back office staff with experience within a major global hedge fund, located in Asia with Asian experience, are likely to be in strong demand.”

Renee Soto, a spokeswoman for Galleon in New York, and David Lau, hired last year as a senior portfolio manager and partner to oversee the Singapore office, declined to comment.

Liquidation

Galleon has about 20 employees, including traders and analysts, in Singapore.

Galleon’s funds, which will be wound down by the end of the year, are selling more illiquid investments now, one of the people said. The firm’s macro and Asian long-short equity funds are managed out of Singapore.

Rajaratnam is one of 20 people accused in what prosecutors are calling the largest hedge-fund insider-trading ring ever charged. He is free on $100 million bail and has said he is innocent.

Galleon’s Asian unit told the Monetary Authority of Singapore in October that its business in the region was then “not the subject of Securities and Exchange Commission investigations in the U.S.,” a spokeswoman at the Singapore central bank said in an e-mailed statement at the time.

“Where we have clear evidence that a financial institution has breached our laws and regulations, we will hold the financial institution to account,” the spokeswoman said Oct. 22.

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