A Profile on James Dondero: A Successful Dallas Hedge Fund Manager

UPDATE October 20, 2016

The Family Place, a Dallas organization providing support for family violence victims, has received a $1 Million grant courtesy of Highland Capital Management, L.P. Highland’s co-founder and president, James Dondero, announced the grant.
“We at Highland Capital Management were impressed by the way The Family Place, through avid philanthropic support, took this concept from inception to the final stage of this campaign in just a year. We are proud to invest alongside many of the most generous and thoughtful in the community.”

The grant helps the Family Place raise the last $2.8 million of its $16.5 million goal for its Legacy Campaign, supporting the construction of a center to provide services to family violence victims.

James Dondero is the Dallas, Texas co-founder of Highland Capital Management. James began his career after graduating from the McIntire School of Commerce, a part of the University of Virginia. He earned a dual degree in both Accounting and Finance and was a member of the honor societies for both disciplines (Beta Gamma Sigma, Beta Alpha Psi).

Upon his graduation in 1984, Jim was accepted into the prestigious training program run by Morgan Guaranty where he worked as an analyst learning the complexities of the corporate bond markets. After his successful completion of the Morgan program, Jim accepted a position with American Express as a bond analyst. Distinguishing himself as capable and insightful, American Express quickly promoted Jim to the position of portfolio manager where he was responsible for a $1 billion fixed income fund.

In 1989, Protective Life approached Jim to assist them with the launch of their GIC subsidiary. By applying his unique skills to the newly formed company, Jim quickly amassed over $2 billion in assets under his management within four short years. Sensing other opportunities, Jim co-founded Highland Capital Management with Mark Okada in 1993.

Today, Highland Capital Management has offices in the major financial markets around the world and has over 150 employees. The company has managed over $23 billion in assets for their clients. Several of the mutual funds run by Dondero’s firm have been awarded by various industry groups. As an example, the Long/Short Healthcare Fund was named as the winner of the 2015 HFM US Hedge Fund Performance Award, and 2016 Thomson Reuters Lipper Fund Awards was awarded to the Floating Rate Opportunities Fund for the best fund in the 5-year category.

Highland Capital Management is well known as an investment bank that employs creative solutions for companies seeking capital but have less than investment-grade debt ratings. Dondero championed the use of collateralized loan obligations. CLO’s package together the corporate debts from several companies based on several criteria, all aimed at mitigating the risk to the investor, while allowing the companies to raise needed capital for expansion.

James Dondero also devotes time with other business interest. He is the chairperson for Cornerstone Healthcare, CCS Medical, and Nexbank. Nexbank is a financial services company based in Dallas. The bank has three core businesses — commercial, mortgage, and investment banking.

Cornerstone Healthcare is licensed as an acute care provider with 880 beds in 19 facilities located in six states. CCS Medical is a distributor of diabetes and wound- care supplies, such as test strips, insulin pumps, urological supplies and prescription drugs, to about 400,000 patients in 47 states. Dondero also serves on the board of directors for MGM Studios and American Banknote.

In addition to his corporate responsibilities, Jim is active in charity and philanthropic work in the Dallas area. His main focus for this important part of his life is helping guide public policy, working on veteran affairs and issues, and strengthening education.

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