RAB Capital is to acquire Northwest Investment Management, the London-based hedge fund manager, for up to £20.55m. The deal comprises a cash payment of £5.2m, the issue of 13.2m RAB shares to the vendors, and a further cash payment in respect of Northwest's net assets of up to £1.5m. Founded in 1988, Northwest manages four absolute return investment strategies: North Northwest, Northwest MultiHedge Japan, Northwest Asia-X and Northwest Pan Asian Warrant. Together, these strategies have around $500m in assets under management. The deal is RAB's second strategic acquisition since it listed on AIM in 2004, and chief executive Michael Buckley said that it would bring further diversification to RAB, particularly in Asian and market neutral products. Northwest's two founders, George Philips and David Rogers, will continue to run the business.