Bermuda-based fund administrator Butterfield Fulcrum Group has been acquired by two of its former managers, Glenn Henderson and Tim Calveley, partnered by private-equity firm BV Investment Partners.BFG, which was part owned by Butterfield Bank and private equity group 3i, will now merge with FORS Ltd, an independent wealth management firm. Mr Henderson and Mr Calveley acquried FORS in March, 2009 after they left BFG.The two firms will operate as separate businesses under their current management teams under a parent company to be headquartered in Bermuda.Terms of the deal, which is expected to close during the first quarter of 2011, were not disclosed.Butterfield Bank said last night that it had sold the whole of its interest in BFG. The sale will result in a distribution to holders of the bank’s contingent value convertible preference shares, estimated at 39 cents to 41 cents per share. Details of the actual payment will be disclosed in Butterfield’s first quarter 2011 financial results.FORS chief executive officer Mr Calveley, who will also be chief operating officer of the new parent company, said last night that he was satisfied with the price paid to acquire 100 percent of BFG and was upbeat about growth prospects.He said the deal had been in the works since last November.“We realised there was an opportunity to come back to the company we were both involved in building,” Mr Calveley said.“We know the business inside out and we have great confidence in the senior management team and the underlying technology and client service. We’ve worked with some of those guys for ten or 15 years.”After the dramatic shrinkage of the hedge funds industry during the financial crisis, the industry is now rebounding, another reason Mr Calveley is upbeat.“We’re buying the business at a great time,” he said. “The hedge fund market has picked up considerably. The fourth quarter of 2010 saw the largest growth in hedge fund assets in history.”BFG employs about 20 people in Bermuda at the Rosebank Centre in Bermudiana Road, has nine offices around the world and $70 billion in assets under administration. FORS employs 16 staff on the Island and administrates $25 billion.BFG was formed by a merger of Butterfield Asset Management and the Fulcrum Group in 2008, after which Butterfield Bank owned 40 percent of the business, 3i owned a 53 percent stake and a group of management and employees owned the rest. Butterfield Bank booked a $115 million gain from that deal.The acquisition comes after reports surfaced earlier this week in overseas media that private-equity giant Carlyle Group was close to agreeing a takeover of BFG, reports that were denied by CEO Michael Clark in an interview with The Royal Gazette.BV Investment Partners is a US-based buyout firm which has invested $2.6 billion of clients’ money since 1983.“BV have been very supportive and enthusiatic,” Mr Calveley said. “They invest in management teams and they were excited to see former senior management returning to a company they knew well.”Mr Calveley saw great benefits from bringing FORS and BFG into the same corporate structure. FORS would benefit from BFG’s human resources, marketing and business development functions, he said, and he hoped it would add to its clientele from some of the wealthy hedge fund managers who work with BFG.“This investment reunites Tim and me with the senior management of Butterfield Fulcrum,” said Mr Henderson, who will take on the role of chief executive officer of the parent company and BFG.“Tim and I know the current management team well. We share the same guiding principles and our complete focus will be to continue to deliver quality service to our clients.”