NEW YORK (TheStreet) --Sage Kelly, the healthcare investment banker who reportedly hosted a hallucinogenic "Mushroom Day" party at his Hamptons home, is leaving Jefferies (JEF) , bringing to a close a turbulent chapter in the firm's history.
Kelly, who earlier this year took a leave of absence, has stepped down from his position and is no longer with Jefferies, a source told TheStreet, confirming an earlier report. The news of Kelly's resignation comes about a month after he concluded a high-profile divorce with his wife Christina, that left him with joint custody of the former couple's two children.
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Jefferies, an investment bank, yesterday announced bonuses that one Wall St. source said were only "flat, to slightly up" after a difficult fourth quarter for the firm. Some bankers at Jefferies, a prestigious firm where top bankers pull in multi-million dollar bonuses, expect the bad bonus news, as well as Kelly's departure, could have long-term fallout.
"You could see other resignations, or recruiters coming to poach bankers," predicted a Wall Street pro at a competing bank.
Part of Jefferies' difficulties came also in the form of a 2011 acquisition of commodities and futures brokerage Bache, that Jefferies now says it will sell. When it announced earnings Tuesday, Jefferies revealed it lost $93 million as revenue fell 43 percent.
Jefferies, owned and operated by Leucadia National Corp. (LUK), saw its parent company lose two percent yesterday on news of lower M&A and trading revenues.