Hedge fund partners at startup Livia split before they even begin: sources

NEW YORK (Reuters) - Sara Tirschwell and Dan Kamensky lined up everything to launch a successful hedge fund, only to realize they could not work together, two people familiar with the matter told Reuters.

The pair decided on an amicable departure from their planned joint-venture, New York-based Livia Capital Partners, according to one of the people. Kamensky will relaunch the fund management company on Jan. 4 as Marble Ridge Capital, the person said. Marble Ridge will have the same five-person team, minus Tirschwell, and it will practice the same “distressed” strategy, investing in the stocks and bonds of financially troubled companies.

On paper Livia seemed well positioned in a highly competitive market. Tirschwell and Kamensky had honed their skills as senior distressed investment professionals at $25 billion Davidson Kempner Capital Management and $18 billion Paulson & Co., respectively

Aurora Investment Management, which places money in hedge funds, had agreed to give them $175 million to help launch, according to one of the people.

And Tirschwell’s position as lead portfolio manager of the firm appeared to position it for investor capital reserved for women and minorities, who are significantly underrepresented in the hedge fund industry.

Livia, legally launched in February, was set to begin trading in December. Aurora has suspended its seed deal, according to the two sources. Aurora declined to comment.

A significant part of the clients who had signed on with Livia are transferring their assets to Marble Ridge, according to the person. The firm will initially be closed to additional capital but Kamensky expects to raise another $200 million in the future.

Tirschwell and Kamensky have known each other for years but never worked at the same organization.

Kamensky was a partner at Paulson who worked on distressed investing from 2009 until February this year. He was part of a team that made winning bankruptcy-related investments, such as Lehman Brothers Holdings and Residential Capital, according to a third person familiar with his background. Before Paulson, Kamensky worked at Barclays Capital and Lehman Brothers.

Tirschwell’s plans were unclear and she did not respond to requests for comment. Before her decade at Davidson Kempner, she led or helped lead bank loan trading at Imperial Capital and NationsBanc Montgomery, which became Bank of America Securities.

Reporting by Lawrence Delevingne; Editing by Lisa Shumaker