UG Investment may launch new China fund

By Jeffrey Hodgson and Doreen Siow

HONG KONG/SINGAPORE (Reuters) - Hedge fund manager UG Investment Advisers is looking to raise $200 million to $500 million for the launch of a Greater China multi-strategy fund, a senior executive with the firm said on Thursday.

The new vehicle's strategies would include looking for arbitrage opportunities in closed-end funds listed in mainland China, said Richard Fan, a partner and director with the $900 million hedge fund manager.

"It's in the very preliminary stages right now. If it does proceed and go forward it will probably launch in the next three months or so," he told the Reuters Hedge Funds and Private Equity Summit in Singapore.

"We would only do it if we could raise a minimum of $200 million."

UG Investment, which operates in Shanghai and Taiwan, is a specialist in investing in the Taiwanese and Chinese markets.

Its six main vehicles include the UG Formosa Patriot Fund, UG Formosa Multi-Strategy Fund, UG Great Wall Hidden Value Fund, UG-Adwell Great Wall Absolute Return Fund, UG Hidden Dragon Balance Fund and UG Hidden Dragon Undervalued Assets Fund.

Fan said UG wants to launch a new multistrategy fund because the Formosa vehicle is currently about 70 percent invested in Taiwan, and the firm wants the flexibility to put a greater percentage of assets to work in mainland China.

FOCUS ON CLOSED-END FUNDS  Continued...