Citi Alternative Investment LLC has sold three hedge fund business units—a fund-of-hedge funds, hedge fund seeding and hedge fund advisory businesses with a collective $4.2 billion of assets under management—to Skybridge Capital, a New York-based hedge fund incubator. The price of the deal was not disclosed.

Skybridge said the acquisition will make it “one of the leading global alternative asset managers.” When the deal is completed later this year, it will have $5.6 billion in assets under management. Skybridge, which was founded in 2005, plans to use the acquisition to expand from its traditional hedge-fund seeding business, which invests in emerging hedge fund managers, into funds-of-hedge funds, which invest in single hedge-fund managers.

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