Universal and York team up for merger arbitrage Newcits launch

US-based hedge fund York Asset Management and Germany's Universal Investment have joined forces to launch a global merger arbitrage Newcits fund - a strategy they describe as the first of its kind in Europe.

The York Lion Merger Arbitrage Liquidity fund is based on the New York firm's Lion Fund Limited and will invest on a global scale in daily tradable securities in both established and emerging markets. It aims at arbitrages which occur due to mergers and takeovers as well as other event driven situations.

'We are proud to launch the first European Ucits fund with a global merger arbitrage strategy,' says Bernd Vorbeck, spokesperson of Universal-Investments management board. 'The fund is a great enrichment for UI-Newcits, Universal-Investments platform for the new funds generation of so called Newcits funds.'

The fund aims to achieve consistent capital appreciation of 9% per annum with a low correlation to equity markets. In recent years the fund had less than half of the fluctuation margin of the S&P 500 but double the S&P 500's returns, according to Universal-Investment.

Only recently established, the UI-Newcits platform already contains nine funds with more than €1 billion under administration.