Kapstream Capital has made its head of credit redundant as it aims for a flatter team structure, while also hiring a new credit-focussed portfolio manager.
Raymond Lee, who spent nearly a decade at Kapstream and previously managed money for Lachlan Murdoch's private investment vehicle Illyria, had his leadership role made redundant after a team review.
"Recently the firm has undertaken a review of team resourcing and configuration. As a result we have elected to revert to a simpler, flatter structure across our credit function, in favour of resource directed more to 'grass roots' credit analysis and portfolio management," Kapstream said in a letter sent to clients.
"Under the revised structure we have determined it unnecessary to continue operating with a 'head of credit' leadership role, and as a consequence advise that Raymond Lee, who has occupied that role for the past five years, has decided to use the opportunity to seek fresh challenges outside the firm.
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"These decisions are not easily reached, and we must commend Ray for his credit leadership, and his significant contribution to the management of Kapstream portfolios over the last 11 years. We wish him all the best in his future endeavours."
As Lee leaves, Kapstream's investment committee will go from having four to three existing members: Steve Goldman, Nick Maroutsos (co-founder), and Daniel Siluk.
At the same time, Kapstream also announced the hire of Mark Bayley as a portfolio manager, reporting to Steve Goldman.
Bayley has previously worked at JP Morgan, ABN AMRO, Dresdner Kleinwort Benson and Aquasia, and has been named top credit analyst by Institutional Investor, Credit Magazine and CFO Magazine, the firm said.
"Consistent with our interest to revert to a flatter structure, and with a greater emphasis on fundamental credit resourcing, we are pleased to announce the hiring of Mark Bayley as a portfolio manager.
Kapstream Capital, which was set up ex PIMCO investors Kumar Palghat and Nick Maroutsos, initially started life with Challenger as a minority shareholder. It eventually sold to Janus Henderson Group in 2015.
Palghat announced his retirement from the business last year and now focuses on his family's private investment company KP4 Capital.
Kapstream currently manages about $16 billion.
Both Lee and Siluk were added to the portfolio leadership group in 2018.