"While we understand that the current market timing of this restructuring may not appear ideal, it in no way impacted our decision to transition the business,” Apex founder and chief executive officer Sandy Colen wrote to investors Friday in a note seen by Reuters. "Instead, this situation results from our technology team’s decision to form a new technology-focused firm."

That new firm is SoMa Equity Partners, and will led by current Apex chief investment officer Gil Simon. An employee since 2006, Simon was Apex’s portfolio manager for investments in the stocks of technology, media and telecommunications companies, or "TMT," since 2012. He has been CIO of Apex since 2015.

Simon will be joined at SoMa by three analysts and four other operational employees from Apex, according to a marketing presentation seen by Reuters.

"After 21 years as the founder and manager of Apex Capital, I have decided to restructure the firm and form a partnership with other family offices that have longstanding expertise and success in manager sourcing and strategic fund investing,” Colen wrote.

The letter said that clients of the stock-focused firm will have the option to take their money back or participate in the new structure. Apex managed approximately $850 million as of January 1, according to the same person.

The restructured Apex will provide a "new multi-manager offering that outsources the majority of capital to best in class funds," the letter said.

Simon's departure is amicable: Colen will serve as an advisor to the new San Francisco-based firm, the presentation and letter said. SoMa is targeting a launch date of May 1 and will also employ a TMT stock picking strategy, according to the marketing document.

The company takes its name from the South of Market area, known as SoMa, which is a hub for San Francisco's technology industry.

Apex's TMT strategy, led by Simon, produced average annual returns of 32 percent for Apex from May 2012 through December 2015, according to marketing materials. Large winners over the period include Netflix and business intelligence software company MicroStrategy, where Apex took an activist role, according to the person.

Apex’s main hedge fund declined approximately 1 percent in 2015, a year when many other stock focused funds also lost money, according to the person. Its main fund averaged 12 percent returns since 1995, more than 3 percent better than the S&P 500 Index over the same period, according to the letter.

Colen was not immediately available for comment. Simon declined to comment.

(Reporting by Lawrence Delevingne; Editing by Andrew Hay)

By Lawrence Delevingne