The co-founder of Absolute Capital Management has quit the UK-listed hedge fund manager after a boardroom clash over how best to boost fund performance and compensate staff during the credit turmoil, sending its share price plunging 58% this morning.

Florian Homm, who set up Absolute Capital in 2002 with co-founder Sean Ewing and was also co-chief investment officer, is thought to be the most high-profile hedge fund executive in Europe to leave his post since the credit crunch spread from the US to Europe in summer.