Stamford, CT, and Boston, MA, March 27, 2007 – K2 Advisors, a $5.5 billion fund of hedge funds, and TA Associates, a leading private equity and buyout firm, today announced that TA has bought a minority interest in K2.  Terms of the transaction were not disclosed. 
 
As a result of the transaction, K2 will invest approximately $100 million of the proceeds in existing K2 strategies as well as incubate new strategies.  The firm will also broaden ownership to a greater number of K2 employees.  K2 management will retain full operating authority and control and there will be no changes to the firm’s investment philosophy, operations or personnel.

“The fund of hedge funds business is changing and to meet new investor demands K2 must grow and invest in the business,” said David C. Saunders, K2 co-founder.  “We believe large institutional investors will increasingly be attracted to cutting-edge firms, like K2, with strong portfolio construction and advisory skills and a commitment to good corporate governance.  It is anticipated that more than $1 trillion will be allocated to hedge funds over the next five years and we expect that TA Associates’ investment in K2 will ensure that we stay at the forefront of that movement.”

“We are very excited to have TA Associates as our partner given their long and distinguished history of investing in the investment management industry,” said William A. Douglass III, K2 co-founder.  “We see a significant number of synergies with TA Associates and its Limited Partners and look forward to working closely with them. We also see opportunities to selectively expand our franchise and this investment will enable us to actively explore those opportunities.”

“We have been looking for an institutional quality fund of hedge funds to invest in for a long time, and K2 Advisors is the type of profitable growth company in which TA seeks to invest,” said Roger B. Kafker, a managing director at TA Associates who will join the company’s board of directors.  “They are a recognized pioneer in portfolio transparency and risk analytics, and their investment process and role as trusted advisor to their clients is unique in the fund of hedge funds industry.   K2’s key investment principals have their roots in the hedge fund industry, which gives them a distinctive perspective on managing risk.”

“We see K2 Advisors as ideally positioned to capitalize on the growing interest of institutional investors in fund of hedge funds,” said Michael A.R. Wilson, a managing director at TA Associates who will also join the company’s board of directors.  “We look forward to working closely with the K2 team to help them build on the impressive K2 platform.”

TA Associates, which has more than 39 years of experience investing in profitable growth companies, has committed over $1.5 billion of its equity to financial services and financial technology companies.  TA’s investments in the asset management sector include Advisory Research, Inc., Affiliated Managers Group, AIM Management Group (AMVESCAP), Numeric Investors and Thomson Advisory Group (PIMCO).

Cleary Gottlieb Steen & Hamilton LLP acted as legal advisors to K2 Advisors in the transaction and Freeman & Co. Securities LLC acted as financial advisor to the firm.  Goodwin Procter acted as legal advisor to TA Associates. 

About K2 Advisors, L.L.C.
K2 is a fund of hedge funds with over $ 5.5 billion under management serving both institutional and private investors globally.  The firm’s diversified portfolios are designed to meet institutional investors’ alternative asset class requirements for capital preservation, absolute returns and low correlation to traditional asset classes. K2’s 67 professionals are comprised of former analysts, traders and risk managers from hedge funds, investment banks and asset managers.  The firm was co-founded by William A. Douglass III and David C. Saunders in 1994, is based in Stamford, CT and maintains offices in New York, Connecticut, London and Tokyo.  K2 is a Registered Investment Adviser with the Securities and Exchange Commission in the U.S.

TA Associates
Founded in 1968, TA Associates is one of the largest and most experienced private equity firms.  With offices in Boston, Menlo Park and London, the firm manages $10 billion in capital and has invested in more than 370 companies.  TA Associates provides management buyout, leveraged recapitalization and growth equity capital primarily for business services, consumer, financial services, healthcare and technology businesses.  More information about TA Associates can be found at www.ta.com.