Madison Street Capital 2016 Hedge Fund M&A Outlook

February 19th, 2016

Madison Street Capital recently released its overview of the hedge fund industry. The report covered the M&A opportunities and transaction activity. Hedge fund deals closed in 2015 were more than those of the previous year. The transactions were also 27% higher than 2014. These are some of the underlying factors that made Madison Street Capital position 2016 to set a record for the hedge fund M&A transactions.
The report by Madison shows that although in 2015 hedge funds performed poorly, the assets in the industry still have a high value. When the performance of hedge funds was poor, investors are allocating their capital to the alternative asset management sector. This is with the hope that they will get higher returns that will match the cost of liabilities. Small hedge funds experience a hard time as they struggle to get new clients. However, hedge fund managers will experience an increase in operational cost and low fees due to the downward pressure on costs. As a result, different hedge fund strategies will have to be considered for hedge funds to adapt.
The environment surrounding the hedge fund industry however will become stronger in 2016. There will be various deal mechanisms being adapted to accommodate both buyers and sellers. The industry will get to see more deals in the form of partnerships and transactions will be in the line of incubator deals, revenue-share stakes, etc. This will take the hedge fund industry away from the traditional M&A transactions the industry is used to.
Madison Street Capital
Madison Street Capital is a firm that has assisted clients in a wide range of industries internationally. It was founded in 2005 and is a middle market investment banking firm. The firm provides different services to its clients including offering corporate advice, business valuation, financial reporting valuation as well as financial opinions for companies.
Madison Street Capital has offices in North America, Africa and Asia. The firm is a leading provider of advisory opinions of mergers and acquisitions as well as valuation. They are familiar with corporate governance both locally and internationally. Madison Street Capital has the knowledge and experience to match buyers and sellers. They also match the most appropriate financing and capital structure to each client as they consider each client to have a unique situation. Madison Street Capital ensures that clients have knowledge of the opportunities available to them as soon as they appear.

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