Ex-TCI star emerges at rival

The Children's Investment Fund has lost another of its stars to rival hedge fund Theleme Partners in a sign of tensions among top managers at the activist investor.

Oscar Hattink, an analyst at the $6bn TCI and a firm partner since 2008, resigned last year, leaving the firm in August. He has now surfaced as a partner at Theleme, people familiar with the matter told the Financial Times.

Mr Hattink joins six other ex-TCI managers and analysts at Theleme which was launched two years ago by TCI's co-founder Patrick Degorce. Mr Degorce set up the firm after disagreements with Christopher Hohn, TCI's head and one of the hedge fund industry's most enigmatic and publicity-shy figures.

Under Mr Hohn, TCI carved a big reputation at the height of the boom for earning its investors outsized returns - more than 40 per cent annually on average, in the years up to 2007 - and taking on some of the biggest companies in a spate of sometimes fraught boardroom battles.

The departures have done little, if anything, to damage TCI's performance, however. The firm's returns continue to confound its critics

Last year the firm made over 7 per cent for its investors thanks to its shrewd investment decisions, compared to a loss of more than 5 per cent for the average hedge fund, according to Hedge Fund Research - the industry's second worst year ever after 2008. The average equity-focused hedge fund fared even worse, losing 8.3 per cent last year. Theleme also lost money last year.

TCI currently has more than ten partners and in excess of 40 staff in total.

Mr Hohn has donated almost all of his personal wealth generated through TCI to children's charitable initiatives through a foundation run by his wife, Jamie, making him the UK's biggest philanthropist. The endowment runs assets of more than £2bn.

After weathering losses in 2008, TCI faced an uphill battle to make back its investors' money. Although the hedge fund has performed strongly since the crash, it has suffered defections of top staff.

Theleme's founder Mr Degorce, a French naval officer who had spearheaded TCI's controversial activist investments in Deutsche Borse and ABN Amro before the crash, left TCI in early 2009, "for personal reasons", and was soon followed by fellow co-founding partner Snehal Amin, the hedge fund's main US equities analyst.

John Ho, TCI's head of Asia, also left that year. John Sheridan, who replaced Mr Degorce as TCI's lead finance analyst, also subsequently left the firm along with Timothy Keough, Robb LeMasters and Rishi Sunak only to all end up at Theleme.

Stuart Powers, another senior TCI analyst, left in January 2011 and is in the process of launching his own new hedge fund, Hengistbury Investment Partners.

A lawsuit filed by TCI against Mr Hattink in January - and subsequently dropped - sheds a rare light on to the sums involved in the trading of such top hedge fund talent: the 33-year old Mr Hattink's contributions to TCI's investment returns in 2010 earned him a $5m bonus, according to TCI's complaint in the suit.

TCI sued Mr Hattink for the return of money he owed the firm and had not paid as part of a vesting package that had been agreed as part of his bonus. Mr Hohn said that although the lawsuit had been dropped, Mr Hattink "still owes us contractual money."

This story has been changed to reflect comments from Mr Hohn

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