Everest Financial Group, which advised last week that it was winding down its hedge fund of fund business and planned to return capital to shareholders, has announced that it has accepted an unconditional offer from One Investment Group to assume responsibility for the majority of Everest's funds under management.

One Investment Group is a Sydney based independent Australian fund management business covering asset classes including real estate, aviation, shipping, private equity, infrastructure and hedge funds which was founded by Frank Tearle and Justin Epstein.

Everest Financial Group, the ASX listed fund of Fund manager that once had $3 billion in funds under management and advice, has announced that following a strategic review it will sell the fund management business and wind down the operations of the business.

Everest was formed in 2000 and developed a significant fund of fund business focusing on investing in offshore hedge funds on behalf of Australian high net worth clients and institutions. During their heyday Everest linked with Babcock and Brown to become Everest Babcock and Brown, but following the GFC and Babcock's demise, reverted to the more investor friendly Everest Financial Group.

The GFC caused significant issues for Everest, with both performance and liquidity suffering, and redemptions saw FUM reduce significantly as investors lost both capital and patience with the Fund of Fund model. Post GFC Everest attempted to rebuild, but was the subject of a number of corporate and legal challenges which eventually led to the Board's decision to announce a Strategic Review early in June.

Everest's CEO, Jeremy Reid, himself a major shareholder, will relinquish his role, but will act as a consultant to assist with the wind down. Meanwhile the funds management business will be sold to a "suitable qualified" but unnamed third party the board has entered into an exclusivity and implementation agreement subject to due diligence expect to be completed within the week.

In our latest review of the industry we look at the increased volatility in May as well as giving a detailed run-down of the performance of our Model Portfolios.
As usual we include detailed analysis of performance for each strategy, industry comment and ranking tables for April 2010.

For detailed analysis of performance for each strategy, industry comment and ranking tables, please open the attached .pdf file.

ATTACHED FILESMay absolute return and hedge fund review (pdf format)