- Lawrence Schloss leaves firm after two years
- Tom Fuller left earlier this year
- Fuller’s departure said to trigger key-man provision
Angelo, Gordon & Co has experienced some turnover recently.
Lawrence Schloss, president of Angelo Gordon, left the firm in March after more than two years, according to a letter the firm sent out last month.
The firm has no plans to replace Schloss, according to an LP who read the letter to Buyouts. Schloss’s name and bio have been removed from the management section of the firm’s website.
Why Schloss left is unclear. His responsibilities around management, marketing and strategy will be taken up by other executives, according to the letter.
Schloss’s departure will not trigger key-man provisions in any of the funds, according to a source familiar with the matter. The departure will not affect the way the firm is run or its investment process, the letter said.
Schloss joined Angelo Gordon in 2013 after an almost four-year stint as chief investment officer and deputy comptroller for asset management at the New York City Retirement Systems. At the pension Schloss earned a reputation for pushing back against GPs on fees. During his tenure, the pension system completed the sale of almost $1 billion of its private-equity portfolio.
Prior to joining the pension system, Schloss co-founded and ran private-equity firm Diamond Castle Holdings. He also spent 22 years at DLJ, eventually becoming chairman of DLJ Merchant Banking, according to his biography on a cached version of Angelo Gordon’s website.
The announcement about Schloss comes after John Angelo, one of the founders of the firm, died in January following a battle with cancer.
Another high-ranking executive, Tom Fuller, who led the distressed-securities team, left in January. He was replaced by Gavin Baiera, managing director and global head of corporate credit.
The reason Fuller left and his next step are as yet unclear.
Form D filings for Angelo Gordon’s most recent distressed-investment funds, AG Capital Recovery Partners VIII and AG Capital Recovery Partners Europe VIII, were amended to remove Fuller’s name.
It’s not clear how much either fund is targeting or whether they are still fundraising. AG Capital Recovery Partners VIII hit the market in 2013.
A person with knowledge of the firm said Fuller’s departure led to a key-man event in the funds. The firm’s spokeswoman declined to comment on potential key-man events.
Interestingly, the fundraising total listed in regulatory documents for AG Capital Recovery Partners Fund VIII decreased from 2014 to 2015. A filing from December 2014 showed the fund raised about $253.4 million, while an amended filing from December 2015, which excludes Fuller’s name, shows a fundraising total of about $110.9 million.
It’s not clear whether that decrease was related to Fuller’s departure. When key executives leave a fund, limited partners generally get the option to end the investment period. In most cases, LPs choose to keep the fund alive, but will take the opportunity to negotiate terms.
As of March 2015, Fund VIII generated a 0.99x total value multiple, according to performance information from the Contra Costa County Employees’ Retirement Association. Prior funds performed as follows:
- Fund VII produced a 6.7 percent internal rate of return and a 1.28x multiple.
- Fund VI generated a 1.43x multiple and a 7.9 percent IRR.
- Fund V produced a 1.14x multiple and a 3.3 percent IRR.
Fuller joined Angelo Gordon in 2000. It’s not clear when he took over the distressed-securities business. The former distressed-securities chief, Jeffrey Aronson, left the firm in 2005 and started credit-focused shop Centerbridge Partners.
Angelo Gordon, which manages $25 billion, recently made two significant hires for the distressed group: John O’Meara, managing director and head of distressed-debt analytics at Morgan Stanley; and Bryce Fraser, managing director atWatershed Asset Management.
Both are joining as managing directors, the spokeswoman confirmed. It’s not clear whether they have started or, if not, when they will start.
Angelo Gordon was formed in 1988 by John Angelo and Michael Gordon. It focuses on credit, real estate, private equity and multi-strategy, according to the investment report from the Contra Costa County employees’ pension.
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Photo of Lawrence Schloss courtesy of Reuters/Brendan McDermid