KING OF PRUSSIA, Pa. — 1838 Investment Advisors LP, a money manager with a long history and more than $14 billion under management at its peak, closed at the end of June, industry sources said.
Plagued by weak performance, the company's assets under management had fallen to $3.6 billion by March 2004, when a management team and Orca Bay Partners, a Seattle-based private equity firm, bought out the company from its parent, MBIA Inc.
Assets continued to hemorrhage under the new owners. With wrap-fee plan providers — including Smith Barney Citigroup, Legg Mason, Prudential Investments and LPL Financial — dropping 1838 from their manager lists and institutional clients bolting, the money manager had well under $2 billion when it pulled the plug, industry watchers said.
Ross K. Chapin, a managing director with Orca Bay Partners who became chairman of 1838 Investment Advisors following the management buyout, declined to comment on reports the money manager had closed.
Orca Bay's website still lists 1838 as one of the private equity firm's portfolio companies, but calls to the King of Prussia-based company's listed telephone number go unanswered, and its website no longer functions.
Most recently, Morgan Stanley Investment Management announced July 28 that it had hired Hans van den Berg and David Sugimoto and become interim adviser of the mutual fund the pair manages, the $22.7 million 1838 International Equity Fund. A Securities and Exchange Commission filing listed Mr. Van den Berg as president of 1838. He was basically "the guy that turned the lights out," said one 1838 veteran, who declined to be named. Messrs. Van der Berg and Sugimoto were not available to comment.