Apax founder Cohen backs $4.3bn IAM management buyout

Sir Ronald Cohen, the founder of private equity house Apax, has emerged as a backer of the management buyout of a $4.3bn (£2.2bn) hedge fund business, which has been divested by Fortis in the wake of the ABN Amro takeover.

International Asset Management (IAM), a fund of hedge funds businesses, has launched the management buyout from Fortis only two years after it was bought out by Dutch group ABN.

The management has brought in Sir Ronald as an outside shareholder to back its play, along with investment bank Jefferies Group. While the size of the individual holdings were not disclosed, it is understood that the 15-strong management team will have a significant majority stake.

IAM was set up in 1989 and remained independent until it was bought by ABN in 2006. Just a year later, ABN itself agreed to a €70bn (£56bn) offer from a consortium comprising Royal Bank of Scotland, Banco Santander and Fortis.

Fortis, which already has a fund of hedge funds, took IAM and has been reviewing the business since the banking megadeal completed at the beginning of April. IAM currently has $4.3bn in assets under management. Sir Ronald, a friend and confidant of Gordon Brown and donor to the Labour party, said yesterday: "For more than a decade, IAM has proved itself to be one of the most successful managers in its field. I am pleased to become a shareholder and have every confidence that IAM has a bright future as an independent company."

Sir Ronald, dubbed "the founding father of UK private equity," was one of three who set up Apax Partners in 1977. He stepped down as chief executive of Apax in 2005 and is currently chairman of Portland Capital and Bridges Ventures, the socially aware private equity group.

IAM's chief executive, Morten Spenner, said Sir Ronald's backing represented a "significant vote of confidence in IAM as a business and as a team".