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Citadel has poached a second London-based portfolio manager from rival Elliott Investment Management, suggesting Ken Griffin’s hedge fund is looking to adopt activist tactics.
Pawel Serej, who left Elliott in the summer, is joining $65bn hedge fund Citadel in London as an event-driven portfolio manager, according to people familiar with the situation. He will focus on risk arbitrage, a strategy that speculates on the successful completion of mergers and acquisitions. Citadel declined to comment.
News of Serej’s appointment comes a month after the Financial Times reported that Nabeel Bhanji, an equity partner and senior portfolio manager at Elliott, was joining Citadel in a global leadership position and investment role.
Bhanji and Serej worked closely together on several of Elliott’s most prominent non-US activist campaigns, at companies such as SoftBank, Swedish Match and Toshiba. Serej’s departure from Elliott, however, came several months ahead of his more senior colleague Bhanji and the Citadel hires were not connected, people with knowledge of the matter said.
Serej will start at Citadel in the middle of next year after a 12-month period of gardening leave, they added.
Activists such as Elliott typically buy stakes in companies and lobby for changes they believe will help increase the share price. More recently, Elliott has launched campaigns against large US companies such as Honeywell, Starbucks and Southwest Airlines.
Citadel is not known for being an activist shareholder in the traditional sense, but the arrival of the Elliott duo suggests that it is looking to adopt some activist tactics.
These typically span a spectrum ranging from threatening proxy fights and vocally calling for a change in management, to so-called constructive activists, or “constructivists”, which identify potential areas for improvement in their portfolio companies and work with management to realise this potential.
Before arriving at Elliott in 2016, Serej worked as an analyst at JPMorgan and at private equity group MidEuropa, according to his LinkedIn profile.
Citadel’s teams trade a range of different strategies across commodities, credit and convertibles, equities, fixed income and macro, and quantitative trading.
Since it was founded in 1990, it has grown into the most profitable hedge fund in the $4.5tn industry’s history. Its flagship Wellington fund gained 13.2 per cent between January and November, according to investors.
Elliott has $70bn in assets under management and is based in Florida. Its London office serves as its main international outpost and is led by Gordon Singer, the son of the firm’s 80-year-old founder Paul Singer.
Bhanji and Serej mark two of more than half a dozen senior exits of senior employees from the London office in the past few years.