Investors could close Alchemy as Moulton plans new start-up

Resignation of 'key man' puts future of private-equity house in doubt

Jon Moulton, the legendary buy-out investor who dramatically quit Alchemy last week, is said to be already working on plans to set up a new fund.

Sources close to Mr Moulton said the private equity expert, who became a household name for his high-profile attacks on his own industry, is thinking about starting a small generalist turnaround fund.

One Alchemy investor, said: "This is a huge blow-up, but once the dust is settled Jon is looking at another start-up, concentrating on what he knows best which is distressed situations."

Another source close to Alchemy added that Mr Moulton's resignation is now expected to trigger the "key man" clause and that LPs – investors in the fund – would now call for it to be wound up.

The banker, who is also an Alchemy investor, added: "This row is going to run and run. Everyone in the industry is extremely nervous right now and if you ask any investor in the world – even at the big funds like Blackstone – if they want to take cash, I bet they would all say they want the money. No one wants to make any commitment to any new investments with the markets so uncertain. "

One of the catalysts for Mr Moulton's sudden exit was the decision by Alchemy and its partners to turn the fund into a specialist financial services buy-out house and to appoint Dominic Slade to replace him when he was due to retire in October 2010.

Mr Moulton, in his resignation letter to investors, explained that he believed this strategy was wrong as it wasted a "spectacular opportunity in our area of perceived greatest strength."

The withdrawal of several investors recently meant that Alchemy's investment capacity would fall from £400m a year to about £100m this year, he said in his typically forthright letter to investors. He added this is due to a number of market conditions – low new deal activity, weak investment performance and continuing losses – that had sapped confidence.

A regular media commentator on financial affairs, the 58-year-old also admitted to Alchemy investors that he – and his partners – were to blame for the current situation. "I feel I owe investors an apology for quite a few things," he said. "Together with my partners past and present I made too many investment and people errors."

No one at Alchemy was available to comment but other sources suggested that Mr Moulton had once again gone a step too far in making his resignation letter public and airing the firm's disagreement in such a manner. They also said that, contrary to Mr Moulton's statement, the fund had not yet made a decision to concentrate on financial buyouts.

Voices
Hunted: A stag lies dead on Jura, where David Cameron holidays and has himself stalked deer
voicesThe Scotland I know is becoming a playground for the rich
News
newsMcKamey Manor says 'there is no escape until the tour is completed'
News
people'When I see people who look totally different, it brings me back to that time in my life'
Arts and Entertainment
Soul singer Sam Smith cleared up at the Mobo awards this week
newsSam Smith’s Mobo triumph is just the latest example of a trend
PROMOTED VIDEO
News
ebooksAn unforgettable anthology of contemporary reportage
News
news
News
people

Britain First criticised for using actress's memory to draw attention to their 'hate-filled home page'

Arts and Entertainment
A photograph taken by David Redferm of Sonny Rollins
people
News
news

Emergency call 'started off dumb, but got pretty serious'

Extras
indybest
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Compensation and Benefits Manager - Brentwood - Circa £60,000

£60000 per annum: Ashdown Group: Compensation and Benefits Manager - Compensat...

Data Analyst/Planning and Performance – Surrey – Up to £35k

£30000 - £35000 Per Annum plus excellent benefits: Clearwater People Solutions...

IT Systems Business Analyst - Watford - £28k + bonus + benefits

£24000 - £28000 per annum + bonus & benefits: Ashdown Group: IT Business Syste...

Markit EDM (CADIS) Developer

£50000 - £90000 per annum + benefits: Ampersand Consulting LLP: Markit EDM (CA...

Day In a Page

Wilko Johnson, now the bad news: musician splits with manager after police investigate assault claims

Wilko Johnson, now the bad news

Former Dr Feelgood splits with manager after police investigate assault claims
Mark Udall: The Democrat Senator with a fight on his hands ahead of the US midterm elections

Mark Udall: The Democrat Senator with a fight on his hands

The Senator for Colorado is for gay rights, for abortion rights – and in the Republicans’ sights as they threaten to take control of the Senate next month
New discoveries show more contact between far-flung prehistoric humans than had been thought

New discoveries show more contact between far-flung prehistoric humans than had been thought

Evidence found of contact between Easter Islanders and South America
Cerys Matthews reveals how her uncle taped 150 interviews for a biography of Dylan Thomas

Cerys Matthews on Dylan Thomas

The singer reveals how her uncle taped 150 interviews for a biography of the famous Welsh poet
DIY is not fun and we've finally realised this as a nation

Homebase closures: 'DIY is not fun'

Homebase has announced the closure of one in four of its stores. Nick Harding, who never did know his awl from his elbow, is glad to see the back of DIY
The Battle of the Five Armies: Air New Zealand releases new Hobbit-inspired in-flight video

Air New Zealand's wizard in-flight video

The airline has released a new Hobbit-inspired clip dubbed "The most epic safety video ever made"
Pumpkin spice is the flavour of the month - but can you stomach the sweetness?

Pumpkin spice is the flavour of the month

The combination of cinnamon, clove, nutmeg (and no actual pumpkin), now flavours everything from lattes to cream cheese in the US
11 best sonic skincare brushes

11 best sonic skincare brushes

Forget the flannel - take skincare to the next level by using your favourite cleanser with a sonic facial brush
Paul Scholes column: I'm not worried about Manchester United's defence - Chelsea test can be the making of Phil Jones and Marcos Rojo

Paul Scholes column

I'm not worried about Manchester United's defence - Chelsea test can be the making of Jones and Rojo
Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

While other sports are stalked by corruption, we are an easy target for the critics
Jamie Roberts exclusive interview: 'I'm a man of my word – I'll stay in Paris'

Jamie Roberts: 'I'm a man of my word – I'll stay in Paris'

Wales centre says he’s not coming home but is looking to establish himself at Racing Métro
How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?

A crime that reveals London's dark heart

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?
Meet 'Porridge' and 'Vampire': Chinese state TV is offering advice for citizens picking a Western moniker

Lost in translation: Western monikers

Chinese state TV is offering advice for citizens picking a Western moniker. Simon Usborne, who met a 'Porridge' and a 'Vampire' while in China, can see the problem
Handy hacks that make life easier: New book reveals how to rid your inbox of spam, protect your passwords and amplify your iPhone

Handy hacks that make life easier

New book reveals how to rid your email inbox of spam, protect your passwords and amplify your iPhone with a loo-roll
KidZania lets children try their hands at being a firefighter, doctor or factory worker for the day

KidZania: It's a small world

The new 'educational entertainment experience' in London's Shepherd's Bush will allow children to try out the jobs that are usually undertaken by adults, including firefighter, doctor or factory worker