Investors in Shumway Capital Partners have been given until January 30 to submit redemption requests or else tacitly approve the firm’s announced restructuring, in which founder and Tiger Cub Chris Shumway will step back from his role as chief investment officer.
Shumway has handed his title to former equities head Tom Wilcox, who will transition to CIO as early as January 31, 2011, and will be the funds’ sole portfolio manager. Shumway will continue to be actively involved, serving as chief executive and chairman of the management committee. The firm, which was founded by Shumway in 2002, managed $8.5 billion as of July 1.
After strong returns in years past, the firm has struggled in 2010, with its SCP Atlantic Fund down an estimated 1% through October after having been whipsawed by difficult market conditions this summer. The special redemption window was triggered by the firm’s so-called key man clause when Chris Shumway announced his new role.
According to an investor letter, Shumway is forming a new “internal partnership” that “reflects the development of Shumway Capital and a continuity of both leadership and process.”
New equity partners will be Tom Wilcox (portfolio manager for equities), Ken Palumbo (chief operating officer), Julie Trent (head of business development) and Neil Shah (managing director responsible for health care investing), who have an average tenure of nearly eight years at Shumway. According to a biography in the letter, Wilcox is a member of Shumway’s management committee, and since 2009 has been a portfolio manager and led the equity strategy. He joined the firm in 2004 and was named managing director in 2005. Before Shumway, Wilcox spent four years as an analyst at Gardner Lewis Asset Management.
The move surprised some investors, especially given a recent deal with Goldman Sachs earlier this year. In January, Shumway sold an 8% stake to a Goldman Sachs leveraged-buyout fund, Petershill. Shumway Capital used the proceeds to finance a partnership to include senior executives of the Connecticut firm. Shumway sent a new letter to mollify confused investors on November 30, extending redemptions from December 3.
“I will continue to dedicate my full focus and attention on Shumway,” he wrote.
Lawrence Delevingne
