Peninsula Participacoes Ltda., the investment firm managing assets for the billionaire Abilio Diniz and his family, is expanding its push into Brazil’s hedge fund industry.
(Bloomberg) — Peninsula Participacoes Ltda., the investment firm managing assets for the billionaire Abilio Diniz and his family, is expanding its push into Brazil’s hedge fund industry.
O3 Gestão de Recursos Ltda., the fund manager created by Peninsula, plans to launch four products open to investors outside the family in addition to its existing flagship global hedge fund, O3 Retorno Global Qualificado, according to Daniel Mathias Alves Pinto, a partner and chief investment officer at O3 Capital.
The company also hired former Citigroup Inc.
executive Priscila Araujo to run an equity product focused on Brazilian markets and plans to recruit an economist.
“I expect that Brazil’s interest rates should start to be cut in September, and as soon as that happens the massive outflows that the fund industry is facing should stop, and we should begin to see inflows again,” Mathias said in an interview.
“It’s been two years of outflows, a lot of money left the industry, because it is very hard to convince people to take risks when you have the basic interest rate at 13.75%.”
In addition to the equity fund, O3 is also planning to launch a Brazil and emerging-markets macro fund that trades assets such as currencies, interest rates or commodities based on economic and political views.
It will be managed by Marcello Curvello.
A quantitative fund and an active fixed-income fund will probably also be set for the second half of this year, both managed by O3 partner Diogo Duarte, Mathias said.
The idea would be to serve all types of investors, including individuals and institutions such as pension funds and insurance companies.
Brazil’s fund industry managed 7.6 trillion reais ($1.5 trillion) as of May 19, after facing outflows of 324.8 billion reais in the previous 12 months, according to Anbima, the capital-markets association.
Fixed-income funds suffered the most after a wave of companies filed for bankruptcy protection, including Americanas SA and Light SA.
O3’s active fixed-income fund won’t invest in corporate credit, Mathias said.
Its focus will be arbitrage, a strategy that involves exploiting price differentials or distortions, including in the futures market.
Peninsula, with $2.3 billion in assets under management, started accepting outside investors about two years ago.
It gave a 50% stake in its asset-management unit O3 to portfolio managers, also providing seed capital to the first fund. With a team of about 20 people, O3 has about 1.6 billion reais in assets under management.
Diniz, 86, has been on the board of French retailing giant Carrefour SA since 2016 and owns, along with Peninsula, more than 1 billion euros of shares, according to the company’s annual report.
One of the most well-known entrepreneurs in Brazil, Diniz has a TV show on CNN Brazil, and was at the center of a battle with Group Casino’s Jean-Charles Naouri that ended in 2013, when Diniz lost control of the giant supermarket chain Pao de Acucar, founded by his father in 1948.
–With assistance from Daniel Cancel.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.
