ECONOMY

Hedge funds see Greek end game approaching

Hedge fund managers looking to profit from corporate announcements such as mergers and acquisitions are scaling up their bets in Europe, confident that a resolution of the Greek debt crisis is near and will spark an increase in deal-making.

A conclusion to the long-running Greek debt crisis, whatever the outcome, would remove one of the big obstacles to deal-making in Europe and unlock billions more in corporate cash.

“The only thing holding us back is this dance still going on for Greece,” said Reade Griffith, co-founder of Polygon, who manages one of the biggest event-driven hedge funds in Europe.

A recent Reuters poll indicates a one-in-three chance of Greece reaching a deal with its creditors.

John Melsom, who manages $60 million in Omni Partners’ Omni Event Fund, said investors were becoming more confident that the Greek crisis will be manageable.

“If they set a precedent how to manage the Greek situation and keep them in the eurozone, I think that will give people a lot more certainty and you will see a lot more deals.”

[Reuters]

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