After Rolex Robberies, the Homms Divorce, and the Fund Sinks

How far will one man go to spurn his ex-wife? That question may arise as the survivors of the hedge fund Absolute Capital try to make sense of the riveting drama that's gripped it for the past week.

Last Tuesday, the hedge fund's colorful co-founder, Florian Homm, abruptly quit after claiming irreconcilable differences with the firm's management over compensation issues. Investors tried to pull their money out of the firm's funds, prompting Absolute Capital to halt redemptions and its shares to plunge by 80 percent. In his resignation letter, Homm vowed to do his part to "fight for shareholder value," since he is one of its biggest investors with a 19.2 percent stake.

But that was last week. This week, an entirely different picture emerges.

It turns out that Homm unloaded most of his shares on Friday in a fire sale to an investment vehicle run by another Absolute Capital executive. He sold 10 million shares at the bargain basement price of 32.5 pence per share, or $6.6 million total, leaving him just a 4.77 percent stake in the company. Absolute shares opened today at about 50 pence per share.

Where does the ex-wife come in? It turns out they had just been through a divorce, and as part of the settlement, he gave her millions of shares of Absolute Capital. So Susan Devine Homm, with a 5.8 percent stake, is now a bigger shareholder in the firm that her ex-husband almost single-handedly crushed last week.

Complicating matters further, a report in the Sunday Times of London yesterday claims that Homm went to Zurich to see his ex-wife last weekend, just days before he surprised everyone with his resignation. According to "a friend" of Homm's, the meeting went badly.

He returned to Majorca, Spain, where Absolute Capital is headquartered, early last Monday morning, according to the Times. After telling Absolute's chief executive Jonathan Treacher he was too tired to come into the office that day, Treacher says he didn't hear another word from him until receiving his letter on Tuesday. (Homm keeps growing in the eyes of the Times, it is worth noting. In a report on Wednesday, Homm was described as being 6-foot, 6-inches. By Sunday, he was 6'8''.)

"He's a cross between Einstein and Mike Tyson: bright, intelligent, volatile and aggressive," a Homm friend told the Times.

So far, the former Mrs. Homm has maintained a low profile while her ex-husband seems to generate one drama after another. Florian Homm garnered attention last year when he was shot in a botched robbery attempt for his Rolex. (Interestingly, Susan Devine Homm made headlines three years earlier in London, when her own Rolex watch was nabbed by thieves.)

We may never know the true story behind the Homm debacle at Absolute Capital. Treacher maintains that he has no idea why Homm fled the coop so abruptly but he plans to hire lawyers and investigators to examine the series of events.

by Megan Barnett