06/02/2007 Author: Elana Margulies

Chimay Capital shuts down onshore fund

NEW YORK: Chimay Capital Management is pulling the plug on its onshore fund, a year after launch, according to chief investment officer Guy Albert de Chimay.

“It wasn’t achieving the objectives of critical mass,” he said. The fund was more desirable to offshore investors who don’t have to worry about tax as their primary issue, he added.

In addition, the onshore long/short fund, named Spartan Mullen Chimay II, underperformed in the final few months of 2006. It finished the year down 0.79%, after having taken big hits in both September and October, when it was down 5.27% and 10.78%, respectively.

Due to the demand from offshore investors, Chimay is planning to launch a second offshore fund in the next quarter. Its current offshore fund, the Spartan Mullen Chimay, which launched in April 1998, is now closed to new investors.

Spartan Mullen Chimay III will run pari passu to the first offshore fund, implementing a long/short strategy, balancing 10 long and 10 short positions in mid- and large-cap stocks. It is expected to debut with $5m of principal money with an initial target of $250m.

The flagship offshore fund had a year-to-date return of 1.21% in 2006.

Guy Albert de Chimay will be the fund’s portfolio manager. Before co-founding his investment firm, he held various roles with Chemical Bank. He said he is also looking to hire more senior level executives for the forthcoming launch.

The upcoming fund will have the same terms as the existing funds, with a $1m investment minimum, 1.5/20 fees and a six-month lockup.