RS Investments has fired Elijah Asset Management as sub-advisor to its Value + Growth and Information Age Funds. RS is now managing the funds internally.
"The trustees of the fund chose not to renew their contract," said Rowena Itchon, RS spokesperson. "We had fundamental differences of opinion in overall business management unrelated to performance issues."
The news came as a surprise to Elijah: "The discontinuance of the relationship was unexpected," said Michael Dunn, chief operating officer for the San Francisco firm.
Dunn also expressed surprise at RS's characterization that the firms disagreed on "overall business management." Instead, Dunn explained the firms had been renegotiating their sub-advisory contract for some time and had difficulty arriving at a satisfactory conclusion.
Ron Elijah, CEO of Elijah, had managed the funds since their inception. At the time, Elijah had worked for RS but left in 1999 to start his own firm, which sub-advised the funds.
"The growth in our business has required us to further define our focus," said Elijah. "Elijah Asset Management plans to focus on its faster growing mutual fund partners and its alternative investment products."
Near the end of last year, Elijah reportedly dropped its sub-advisory relationship with the United Global Internet Fund, a UOB Asset Management unit trust. The firm apparently cited strategic reasons for bowing out. Kinetics Asset Management assumed sub-advisory duties for Singapore-based UOBAM.
In the mutual fund arena, Elijah continues to sub-advise the AIC Global Technology Fund as well as the Aetna Technology Fund.