Hedge Fund Founder Quits Over Pay Dispute

Sep 18 2007 | 12:11pm ET

Florian Homm has resigned from Absolute Capital Management Holdings, the hedge fund he founded, sending shares of Swiss-based, London-listed and Spanish-run ACM into a tailspin, down upwards of 60%.

“I share a different investment and management philosophy from the current and prior management” of the firm, Homm, who last year survived a shooting in Venezuela, wrote in his parting shot. “The Board of ACMH did not agree with my arguments that ACMH needs to pay adequate compensation to retain top-level fund managers nor did they follow my lead in sacrificing personal bonuses and compensation, or in contributing ACMH shares to the funds.” 

According to Homm, he poured some €33 million (US$45.7 million) into ACM’s funds in an effort to steady them during the recent market turmoil. In addition, Homm said he has “forgone my bonus this year with the intention to share it with the many investment professionals” at the firm.

“As a result of my actions, those funds have ended up positive or neutral for the month,” he wrote.

Homm, who currently serves as co-chief investment officer of the firm, said his resignation becomes effective tomorrow.

The resignation reportedly took ACM executives by surprise.

Homm said he has no plans to found a competitor to ACM, and that he remains the firm’s largest shareholder.

“I hope that my leaving ACMH will force management to realize that its most important asset are its highly-skilled investment professionals,” he wrote.

Homm's Resignation Letter


In Depth

Steinbrugge: Top 10 Hedge Fund Industry Trends for 2017

Jan 3 2017 | 9:03pm ET

Each year, Agecroft Partners' Don Steinbrugge predicts the top hedge fund industry...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

DarcMatter: The Top Trends in Alternative Investments for 2017

Jan 13 2017 | 8:22pm ET

The $7 trillion alternative investments industry is poised for continued growth...

 

From the current issue of

The U.S. Commodity Futures Trading Commission (CFTC) ordered The Goldman Sachs Group Inc., and Goldman, Sachs & Co. to pay a $120 million penalty for attempted manipulation and false reporting of ISDAFIX Benchmark Rates, a global benchmark for interest rate products.