Michael Weinberger, who left York Capital Management in January 2016, is planning to start a new hedge fund firm named Cerrano Capital this summer, according to two people with knowledge of the matter.
Cerrano is expected to launch with $500 million to $1 billion of capital, mostly from friends and family, but also including contributions from foundations, endowments and funds of hedge funds, said one of the people. The firm’s prime brokers will be Goldman Sachs and Morgan Stanley.
Weinberger, 42, has recruited Jamie Lester, a short-selling specialist who ran his own hedge fund, Soundpost Partners, before shutting down and joining David Einhorn’s Greenlight Capital, the person said. Short selling is one of the hardest skills to master, and having a dedicated specialist could help Cerrano outperform in both up and down markets.
An employee at Greenlight confirmed Lester’s departure and declined further comment.
Weinberger, who had worked at York Capital for more than 15 years, announced last year that he would start his own hedge fund firm, without specifying when. Establishing a hedge fund has become more difficult in recent years because of disappointing industry performance compared to low-cost passive funds. Gone are the days of asset managers looking to raise $2 billion or $3 billion out of the gate, with many managers now setting smaller targets.
Eric Mindich, who recently announced he was closing down his Eaton Park Capital Management, represented something of a high point for hedge fund launches in 2004, when he founded the firm with $3.5 billion of capital. Last year, a range of $100 million and $500 million was typical for a new, high-profile hedge fund.
Weinberger had been head of equities at York Capital, co-managing the firm’s York Select Funds along with David Damast. At Cerrano, Weinberger is expected to follow a similar event-driven strategy. York Capital had about $16 billion of assets under management at the end of last year, according to its form ADV.
