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September 12, 2018  

Ex-Paulson Pro Inks Seeding Deal for Soleus

Former Paulson & Co. executive Guy Levy has secured a seed investment from an affiliate of Stone Point Capital.

It’s unclear how much the Stone Point affiliate is investing in Levy’s startup, Soleus Capital of Greenwich, Conn. What’s known is that Soleus is prepping two funds — an equity hedge fund and a private equity vehicle — that are set to launch in the next few weeks with a combined $75 million.

Stone Point, a New York private equity manager, has invested some $4.5 billion in nearly three dozen asset-management businesses over the years — mostly those focused on credit markets. In the hedge fund realm, Stone Point’s best-known seed investment was Sound Point Capital, a now-$19 billion distressed-debt shop led by Stephen Ketchum.

Its investment in Soleus — via an affiliate called SP Soleus Holdings — marks a rare instance of Stone Point backing an equity-focused fund shop. One earlier example was Castle Point Capital, whose founder, Todd Combs, subsequently was tapped by Warren Buffett for a top investment role at Berkshire Hathaway.

The partners of SP Soleus Holdings include two or more principals of Stone Point, which is led by James Carey, Charles Davis, Stephen Friedman, David Wermuth and Nicolas Zerbib.

Soleus’ hedge fund, dubbed Soleus Capital LP, will invest in the stocks of healthcare and pharmaceutical companies — just as Levy did at Paulson.

Soleus Private Equity Fund 1 will target mid- and late-stage investments in those same areas.

Levy was a senior investment professional at Paulson, having been tapped by founder John Paulson in 2015 to launch the firm’s first long/short equity fund. But two years later, Paulson wound down the fund amid a strategic shift to re-focus on the firm’s core areas of merger arbitrage and distressed debt.

Levy’s fund posted an undisclosed loss in 2016, but gained about 18% during the first half of 2017.

At Soleus, Levy is assembling an investment team that so far includes five professionals — including two who still are transitioning from their previous positions. In addition to Levy, the other two are managing director Lennox Ketner, who previously worked with Levy at Paulson, and healthcare analyst Zachary Williams, who arrived in June from an associate positon at Citadel unit Aptigon Capital.

Also on board is founding partner and chief operating officer Steve Musumeci, who previously held the same title at Center Pond Management and HealthCor Management.