Hedge fund Tribeca eyes Venezuela gold rush after 127% gain

Maduro’s deputy, who has now become acting president, initially denounced the raid as “barbaric” but has also called for cooperation.

• Ben Cleary sees Venezuela as a major investment opportunity after US action
• Tribeca fund team visiting Caracas to explore assets and partnerships
• Uncertainty remains over investor protection and future profits in Venezuela

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For portfolio manager Ben Cleary, whose hedge fund more than doubled its money last year, Venezuela in the aftermath of Donald Trump’s controversial attack is one of the biggest ever opportunities for investors to make money.

Cleary, whose main Tribeca Global Natural Resources feeder fund generated estimated returns of 127% last year, is sending a team of investors to Caracas this week to meet would-be partners and inspect potential assets. Over the weekend, his team held discussions with Venezuelan firms about potential investment opportunities.

“Every bank is sending people in,” the Australia-based investor said in an interview, describing numerous calls and meetings facilitated by bankers and brokers, including Canadian firms. “It’s a massive gold rush.”

The rapid attempt to weigh up investment opportunities in the country comes after the US snatched Venezuela’s leader Nicolás Maduro in an audacious raid. But there is still huge uncertainty about what comes next.

Maduro’s deputy, who has now become acting president, initially denounced the raid as “barbaric” but has also called for cooperation. Trump, though, has made clear he considers the US to be in charge. He also said that US energy companies will spend billions of dollars to rebuild Venezuela’s crumbling energy infrastructure.

Cleary, a partner and director of the $4 billion Tribeca Investment Partners, made his big returns last year in part by betting on precious metals and mining firms. He said he’d be willing to add Venezuelan assets worth as much as 10% of his fund’s capital if Trump’s stated program is successful and the country becomes conducive for foreign investment.

Opportunities range from buying into publicly traded companies that will gain from ramped up resource production to providing private credit to local firms, he said. Bond funds have already benefited from a turnaround in Venezuela’s debt prices, after Trump ramped up pressure on the country in recent months.

The US move has generated backlash from some major powers. China has led countries denouncing the capture of Maduro, calling it a “hegemonic act.”

It is unclear how much protection investors in Venezuela will have — not just in terms of legal recourse but even physical control over assets, given the country’s changing security situation.

That uncertainty will add to the hurdles facing larger investors such as pension plans, sovereign wealth funds and private equity giants who may eventually join the investment rush. It may also mean that by the time they get the green light to invest, the big profits will no longer be on the table.

“By the time the people who can’t invest can, the horse will have bolted,” Cleary said.