03/02/2011

Mandell Gives Up on Coeus to Join Carlson

Lloyd Mandell has pulled the plug on his Coeus Capital and taken a position at Carlson Capital.

Mandell, who founded his Greenwich, Conn., firm in 2006, just finished returning $300 million to investors. Coeus apparently struggled to raise capital amid humdrum returns, including a 4% gain last year — when the S&P 500 index rose 15%. The fund's cumulative gain since its inception more than four years ago: 27%, compared to a 1% gain for the S&P.

In a Feb. 11 letter to investors, Mandell suggested Coeus wasn't generating enough fee revenue to support its payroll. He said he decided to shutter the firm because it wasn't “fair” to maintain his staff in such a difficult fund-raising environment.

Mandell joined Dallas-based Carlson as a portfolio manager on March 1. He was brought on to help expand Carlson's book of healthcare-related investments. Mandell will pick healthcare stocks from a Carlson outpost in Greenwich.

Carlson, with $6.5 billion of assets, is a multi-strategy shop that divvies up its capital among 30 portfolio managers, who trade credit, equity, event-driven and relative-value strategies. Carlson's flagship fund, Double Black Diamond, gained 10.3% last year. The firm employs 70 investment professionals overall.

It's unclear how big a staff Mandell had at Coeus. One of his analysts, Shantanu Mukherjee, left in January to join activist investor P2 Capital of New York.

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