UBS Group AG (SWX:UBSG) is in talks to sell its hedge fund unit O?Connor (UBS O'Connor LLC) to Cantor Fitzgerald LP, a move that would end a more than three-decade run of ownership by the Swiss bank, according to people familiar with the matter. The deal could involve a possible revenue sharing agreement, one of the people said. In that case, Cantor would acquire the unit from UBS?s asset management division, and the Swiss bank would receive some of the proceeds, the person said.
UBS is currently seeking ways to trim riskier businesses overall as it faces extra capital requirements of as much as $25 billion due to tougher regulation in Switzerland. A sale would end more than three decades of ownership of the former Chicago-based derivatives house O?Connor & Associates, which its predecessor, Swiss Bank Corp., began acquiring in 1992. O?Connor had $16.5 billion of regulatory assets under management, which includes leverage, at the end of December, according to an annual filing.
Representatives for UBS and Cantor Fitzgerald declined to comment.
