ABC Arbitrage outperforms CAC40 in first half

Paris-based ABC Arbitrage, parent company of ABC arbitrage Asset Management, has reported strong growth in the first half of 2011.

In the first six months of 2011 ABC Arbitrage’s net income rose 5% year-on-year to €16m with net revenues increasing 10% to €39m. Gross return on equity (the ratio of net revenues to average equity) was over 28% in the first half, compared with a 4.66% gain for the CAC40 index over the period.

The group further developed its asset management business during the first half, with fees already totalling €1.4m, compared with €1.2m for full-year 2010.

Since the beginning of the year, ABC arbitrage Asset Management’s offering has expanded with the opening of two new Irish alternative investment funds and attracting €80mn in new money, compared with a full-year target of €100m.

According to the report, ABC Arbitrage’s systematic diversification model has led to these positive results despite the unfavourable business environment with issuers concerned by European sovereign debt, weak volumes, limited volatility and a tentative recovery in M&A activity.

Dominic Ceolin (pictured above), chief executive of ABC Arbitrage, said the company is approaching the second half “prudently yet confidently” due to uncertainty in the financial and interbank markets and limited visibility as to the likely recovery in investor and issuer activity.

ABC Arbitrage was set up in March 1995 by Grégoire Bouguereau to execute arbitrage strategies on most of the European and American financial markets. In 1997, the company started its proprietary trading activity and since 1998 has extended its reach to international financial markets.

Since 2004, the company’s asset management business has been held by ABC arbitrage Asset Management, set up for the third party management activity. ABC Arbitrage has been listed on Euronext Paris (compartment B) since 2003.

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