Millennium Management, one of the world's largest multi-strategy hedge funds, is channelling approximately $1.8bn into two investment teams as part of a strategy to deploy capital both within and outside its organisation, according to a report by Bloomberg.

The report cites unnamed sources familiar with the matter as revealing that New York-based Scopia Capital Management will receive around $1bn to manage for Millennium. The firm, which currently oversees about $1.2bn in assets, will handle Millennium’s funds through a separately managed account, employing its established equity long-short market-neutral strategy, which has been operating since Scopia was founded in 2001.

Chris Tuzzo and Warren Empey, meanwhile, formerly of Kepos Capital, are joining Millennium under its NorthArrow Capital brand, with the duo set to oversee approximately $800m, via a merger arbitrage strategy, Bloomberg's sources revealed.

Representatives for Millennium and Scopia declined to comment on the matter.

The move reflects a growing trend among multi-strategy hedge funds, which are leveraging their abundant capital to back external managers. Millennium has been particularly proactive in this approach, with external managers now accounting for about 10% of its 330-plus investment teams. Many of these external teams exclusively manage Millennium’s capital.

Recent recipients of Millennium’s backing include Val Zlatev’s Analog Century Management, Hong Kong-based Centerline Investment Management, and Diego Megia’s Taula Capital Management, which received $3bn earlier this year. Millennium is also reportedly set to support a new venture by Coatue Management’s Aaron Weiner with billions of dollars.